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Strategies & Market Trends : Trend Setters and Range Riders -- Ignore unavailable to you. Want to Upgrade?

To: Frederick Langford who wrote (20946)	7/19/2002 10:38:03 PM
From: Susan G	Read Replies (2) \| Respond to of 26752

No there was no update, I just saw reference to it on Lee's site. Maybe he will do a chat Sunday night or someone will summarize it if they were there.

To: Frederick Langford who wrote (20946)	7/21/2002 11:21:09 AM
From: Susan G	Respond to of 26752

An article on chips from Today's NY Times... Chip Makers Held Down by Sluggish Recovery By KENNETH N. GILPIN t's hard to feel better about technology stocks in general if you don't feel good about the manufacturers of semiconductors. If the chip makers aren't doing well, most technology companies won't, either. The good news is that conditions are looking better in chipland. The bad news is that it's a relative judgment, because the downturn of the last two years was terrible. And investors are treating the industry horribly. The Philadelphia Stock Exchange's semiconductor index rallied in the first three months of 2002 but has sold off sharply since, and is now down 30 percent so far this year. Jonathan J. Joseph, an analyst at Salomon Smith Barney, called a turn in the stocks over a year ago, and they moved up. But then they fell again. Last week, he said he still thinks better days are ahead. Following are excerpts from the conversation. Q. In April 2001, you said the semiconductor index could trade as high as 700 and as low as 400. Are you still satisfied with that call? A. Our view back then was that semiconductor activity would bottom in the third quarter of 2001, and it did. We thought inventories would get worked down, and they did. That the sharp reduction in capital spending would result in firmer prices and higher utilization rates, and it has. By the end of April this year, semiconductor stocks were up 20 percent over the previous 12 months. During that period the S.& P. 400 was flat, and the rest of technology was down 10 percent. What has brought the stocks down since then is a realization in the investor base that a technology recovery was not happening as rapidly as some had hoped. Q. Are conditions continuing to improve? A. We were very happy with the fundamentals, beginning in the spring of 2001. But this spring we hit a soft patch. Because of continued weak corporate capital spending, in the first quarter the personal computer sector built up excess inventory. That was worked off in the second quarter. Now there are signs that we are heading into a seasonal upturn. But the view is by no means monolithically positive. There are still big chunks of weakness, which is surprising, if not stunning. The lack of business response to 11 interest rate cuts has been a surprise. Q. What evidence do you have that demand is firming? A. Anecdotally, I can say that the main information technology guy at Citigroup, which is one of the biggest buyers of information technology in the world, called up a couple of weeks ago and said the personal computers in the research department are starting to break down, that it is more expensive to fix them than buy them, and to get ready for an upgrade next year. Q. Last week, Intel missed its earnings numbers, but the stock wasn't punished badly. Why? A. We actually thought Intel's numbers could have been worse. They said they would miss in early June, due to the inventory problem we talked about and the fact that microprocessor prices were falling. On their conference call last week they said prices didn't fall, but were flat. Q. How comfortable are you with the financial statements these companies turn out? A. We think most of our top companies are pretty clean. Managements have been in place a long time. They are electrical engineers, not financial engineers. Q. How much of a hit would semiconductor company earnings take if stock options were accounted for as expenses? A. Well, it's not nothing, but earnings would not be cut by that much. Intel, for example, is probably exposed by 5 percent to 10 percent. Of peak 2000 earnings, companies like Advanced Micro Devices, Cirrus Logic, Cypress Semiconductor and National Semiconductor are exposed about 10 percent. Q. Which stocks in the group do you like? A. We are recommending the top-drawer companies, those that don't have shaky balance sheets and are leaders. Micron and Intel are recommended stocks. They are real leaders and are attractive on a valuation basis. In addition, on a seasonal basis they are enjoying a reacceleration, not a dramatic recovery, of the personal computer market. We have a $35 price target on Micron and $27 on Intel. Another name we like is Texas Instruments, which has wide diversification. We think it could go as high as $30. Q. Which names are you avoiding? A. We recently downgraded National Semiconductor, because they are beginning to see some order softness in the personal computer area. In addition, inventories of flat-panel displays have built up, and they have quite a large exposure to cellular handsets. And a few weeks ago we downgraded Cirrus Logic and Advanced Micro Devices. nytimes.com

To: Frederick Langford who wrote (20946)	7/21/2002 11:24:06 AM
From: Susan G	Respond to of 26752

This gold futures chart is so pretty - and easy to read, it makes me want to trade those futures now, too <g> Looking at short term charts, it looks like all the gold shorts got absolutely toasted on Friday morning, so I would expect a short term pullback to at least 318-320 support as they go for their revenge <g> All depends on how the markets go though, if fear continues the way it has lately, this bullflag could break out in a huge way. Especially if there are still the bigs shorts in it. mywebpages.comcast.net The XAU, I know Jerry keeps mentioning it's about to break down in P&F, but looking only at P&F charts he's missing a few things that show up on a regular chart...the huge bullish descending wedge on the daily, as well as a recent double bottom around 70 and several buy divergences in the indicators. With World conditions being what they are, a chart as a prediction of a breakdown or breakout - is pretty useless, as that is what is ruling the moves in this commodity now. mywebpages.comcast.net The low ADX level is indicating a breakout is imminent - BUT it does not predict which way. The fact that the +DI line on the ADX (blue) is turning up while the -DI line (red) is turning down is a hint though. But if that descending wedge breaks that double bottom, all bets are off <g> ROFLMAO at that quote of Barton Biggs in the article you posted on his new found bullishness in gold...I love it! I'm going to remember that one for future use. <g> I am changing what's left of my mind <vbg> PS Fred, there are a ton of gold charts in that chart link I posted, one of my first posts from this morning.