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Strategies & Market Trends : Electronic Contract Manufacture (ECM) Sector -- Ignore unavailable to you. Want to Upgrade?

To: rich evans who wrote (1089)	1/9/1998 11:17:00 AM
From: kolo55	Read Replies (2) \| Respond to of 2542

Bad market today- agree with your post pretty much. I just heard on CNBC that Adaptec's comments in their earnings warning have pushed the whole ECM sector down, and they mentioned Jabil, Sanmina, Micrel and Hadco declines. I didn't hear Adaptec comments, and wonder what the comments were. Adaptec primarily makes HDD controller chips if I recall, so seems that their comments would imply the hard drives sales are under pressure. I'll have to figure out what the rationale for punishing the ECM stocks is. We already knew that the HDD sector is getting hammered due to attempts by Fujitsu and Samsung to grab market share using scorched earth techniques (burn all the crops to the ground, and see who starves first). I wasn't too surprised to see Adaptec get hit, but I don't see the obvious connection to the ECM stocks. Maybe the market is assuming that Adeptec's comments mean that PC sales are collapsing, but I don't see any signs of that. Due to sub-zero PC sales growth, I believe PC unit sales are increasing nicely. Well, I'll go read about Adaptec's comments if I can find anything. Well- came back in time to edit my message-- Seems to me Adaptec was trying to convince the street that they are more than a disk drive industry player after they got hammered with the drive sector last month. But I think the root of their problem seems to be the drive sector problems- On Wednesday Seagate announced their revenues were going to be down significantly compared to a year ago. This has to be hitting Adaptec hard. But I am having a hard time seeing the connection to Hadco and Jabil. Why should Hadco get hammered down 4 points to roughly its 52 week low? Do they make boards for hard drives, and is this a significant part of their business? Paul Paul

To: rich evans who wrote (1089)	1/9/1998 2:26:00 PM
From: jeffbas	Read Replies (1) \| Respond to of 2542

I still stick to my bear market theory. Just as in a bull market stocks acquire valuations that leave you scratching your head, the same thing happens in a bear market. The best thing to do this winter is to hibernate, as you said. With less money going into stocks, the ones that will be hurt the least will be companies not dependent on (higher cost product) sales abroad, or on orders from abroad. That leaves out almost all tech companies.