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Technology Stocks : Semi Equipment Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Gottfried who wrote (6261)	10/17/2002 11:08:20 PM
From: Return to Sender	Respond to of 95471

From Briefing.com: General Commentary - Intel missed its numbers on Wednesday, and the market dropped like a stone. Then on Thursday upped stepped IBM and Nokia - both of which bested estimates - and the sector recaptured much of the Intel-related decline. Which brings us to today and Microsoft. Microsoft didn't just beat by a penny like so many firms, it blew away the consensus estimate by between 7-12 cents (depending upon whether charges were including in most of the estimates). Revenues were also much higher than anticipated due to surprising strength in its move to long-term licensing. Traders responded by giving the stock a nice boost in early after hours trading. Assuming MSFT maintains this momentum in early trading today, the sector should begin the session on a positive note. But don't look for a repeat of yesterday's 3% move, as MSFT stood out from an otherwise sorry crowd. One-time favorites and high-flyers, Sun Microsystems (SUNW) and Siebel Systems (SEBL), guided future estimates lower citing continued sluggishness in IT spending. eBay (EBAY), Molecular Devices (MDCC), Gateway (GTW) and Check Point Software (CHKP) also talked down estimates for the out quarters. Meanwhile, Advanced Fibre Comm (AFCI), which beat estimates handily, noted that "the telecom market environment has worsened appreciably." In other words, aside from MSFT, most of the earnings news wasn't very encouraging. News that the Semiconductor Equipment book-to-bill fell to 0.84 in September on a 34% plunge in orders is also likely to undercut and MSFT-related bounce. Taking into account that the book-to-bill is a 3-month moving average, it strongly suggests that the plunge in orders actually began in August, and that the decline between July and September was probably on the order of 50%. Though many of the chip equipment stocks were trading higher in after hours activity, we attribute that to thin conditions and the positive tone set by MSFT. Briefing.com contends that chip equipment stocks will be hard pressed to sustain gains given this report. Basically, the post-close news reinforced what we already knew. While there are a handful of tech companies performing decently during extremely difficult market conditions, the majority of firms continue to struggle. Reports also confirmed that IT spending remains weak, with little sign of improvement on the near-term horizon. Finally, if you're waiting for tech to resume its role as a market leader you'll be waiting for a long time. Nevertheless, bellwether Nasdaq is sitting just above critical resistance at its 50-day moving average. If the index can hold above this ceiling again today, as well as put some distance between itself and the 50-day moving average, then the positive bias should remain intact for short-term anyway. For all the post-close/pre-open earnings news, please see Briefing.com's Earnings Calendar and/or In Play pages. Robert Walberg Thanks again for all your hard work on the charts. I hope AT&T gets your troubles fixed soon. RtS

To: Gottfried who wrote (6261)	10/17/2002 11:32:32 PM
From: Zeev Hed	Read Replies (3) \| Respond to of 95471

Gottfried, some of my indicators are pointing to a solid retrenchment coming up in the SOX, despite the strong AH (somewhat) and the initial "discounting" of the BTB (which really surprised me here, I did not expect booking to drop that much). During the day I reduced exposure quite a lot. I expect us to retrench for a good three or four days, and then I think that we should be able to mount another leg up (challenging the 283/94 area on the Sox). I think that the retrenchment in the SOX index should be held around 237/40 or so, just around 30 sox points lower, not a great catastrophe, but since I have been too optimistic recently about these retrenchments, I am playing safe and increased cash position a lot today. Zeev