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Technology Stocks : Semi-Equips - Buy when BLOOD is running in the streets! -- Ignore unavailable to you. Want to Upgrade?

To: Mark Oliver who wrote (4778)	2/9/1998 4:01:00 PM
From: Mark Oliver	Respond to of 10921

Chip market estimate lowered By Reuters February 9, 1998, 8:45 a.m. PT SAN JOSE--Market research firm Dataquest today lowered its preliminary forecast for the worldwide semiconductor market to $160 billion by the end of 1998, citing Asia's financial crisis. Dataquest previously had forecast that the market would reach $175 billion by year's end. The volatile situation in Asia caused it to reevaluate all the markets within the semiconductor industry, Dataquest said in a news release that noted its formal forecast for the semiconductor market will be completed in April. "In 1998, worldwide electronic equipment production will likely decline from our previous forecast of $1,009 billion to $953 billion," said Joe Grenier, vice president and director of Dataquest's Semiconductor Devices programs. "This means that 1998 electronic equipment production will grow only about three percent instead of the nine percent previously forecast. Solely because of the decrease in electronic equipment production, the worldwide semiconductor market is likely to decline about $10 billion from our earlier forecast." In addition, the semiconductor forecast could be further reduced by another $3 to $5 billion because of the potentially lower costs of DRAM (dynamic random access memory) manufacturing in South Korea and the devaluation of the won, Dataquest said. A lower cost of manufacturing would result in lower market prices for DRAMs. The net result of the two factors--$10 billion and $5 billion--is that the 1998 semiconductor market could be as low as $160 billion, resulting in a growth of seven percent versus its previous forecast of 17 percent growth, Dataquest said. Throughout 1997, DRAMs were priced at a level near their manufacturing cost, a minimum that must be followed to avoid antidumping duties, the firm said. "Going into 1998, Dataquest sees a continuing overcapacity, forcing manufacturers to continue their efforts to keep prices low to win the fight for their share of their customers' business, a fight they encounter at buyers' desks," said Jim Handy, director and principal analyst for Dataquest's Memories Worldwide program.