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Strategies & Market Trends : Dave Gore's Trades That Make Sense -- Ignore unavailable to you. Want to Upgrade?

To: Frederick Langford who wrote (9099)	7/1/2002 12:08:48 PM
From: Dave Gore	Read Replies (1) \| Respond to of 16631

Chip biz growing, but index down 35%. This is an area to really watch. I am going to be a big buyer when I think it has bottomed. Valuations are still high in some stocks but getting much better. **** By Chris Kraeuter, CBS.MarketWatch.com Last Update: 10:28 AM ET July 1, 2002 NEW YORK (CBS.MW) - Hardware stocks opened lower on Monday, the first trading day of the third quarter, while chip stocks were mixed. Data from a semiconductor trade group showed what analysts said are signs that a recovery continues. The Philadelphia Semiconductor Index ($SOX: news, chart, profile) rose 0.3 percent to 388.8 while the Goldman Sachs Hardware Index ($GHA: news, chart, profile) dropped 1.2 percent to 176.9. The Semiconductor Industry Assoc. said May data indicates global sales of chips rose 2.8 percent to $11.37 billion from $11.07 billion during April, based on a three-month moving average. The SIA cited growth in all product sectors with the exception of computation. Also, the SIA said it still expects second-quarter chip-sales growth of 4.7 percent. As for stock performance during the second quarter, which closed on Friday with the end of June, the chip index lost 35 percent. Tim Mahon, analyst with Credit Suisse First Boston, said this data indicates the industry-wide recovery is on track. "Unit growth continues to be the primary driver during the current recovery as average selling prices declined once again in May," he said, according to a morning research note. Major chipmakers, like Intel (INTC: news, chart, profile) and Texas Instruments (TXN: news, chart, profile) and Motorola (MOT: news, chart, profile), were up modestly. Xilinx (XLNX: news, chart, profile) fell 7.3 percent to $20.77. Eric Chen at J.P. Morgan cut his estimates and ratings for the maker of programmable chips, as well as for its competitor Altera, due to "weaker growth expectations and rich valuations." Altera (ALTR: news, chart, profile) lost 2.3 percent to $13.29.