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

To: sammaster who wrote (7246)	11/3/1998 6:50:00 PM
From: Math Junkie	Respond to of 10921

Turnarounds in semi-equip stock prices start when chip sales start to go up. This is long before equipment orders go up. The market is actually a leading indicator in that regard. <G>

To: sammaster who wrote (7246)	11/4/1998 7:54:00 AM
From: Mason Barge	Read Replies (1) \| Respond to of 10921

Bullish signs: 1) Asian markets seem to be in recovery. Most major markets had big gains last night and the Nikkei is back over the key point of 14,500 yen. I for one remember how this all started and how unwilling people were to believe that deteriorating stock prices in Asia would affect the equipment sector very much. I think it is time to remember the lesson and consider that early signs of a recovery in Japan, Taiwan, Korea, etc. are the harbingers of recovery in the semiconductor equipment sector. 2) PC sales are strong. In Europe, PC sales BOOMED this quarter, they are selling machines like hotcakes, er, croissants. This despite a very weak market in Eastern Europe due to the horrid financial problems in Russia. 3) The price point for PC sales in the US has stopped falling and has levelled off at around $1,150. This is very good news for processor chipmakers, as it bespeaks a strong market for the higher-end, higher-margin chips. Unless I'm missing something, a strong market for higher-end CPU's is going to mean more equipment sales to Intel/AMD etc. An announcement of a major new fab, or an equipment budget increase of $1 billion or so by Intel, would drive the whole sector up 10% in one day. 4) There is considerable educated opinion that even DRAM is going to see at least a temporary (1-2 year) firming of prices in 1999-2000. There's a lot of conflicting opinion on DRAM, however. The "cash-card" smart cards are not catching on, which will hurt some of the smaller RAM technologies such as Ramtron to a degree, but the market for transportation smart cards is waiting to happen, as consumers appear to like them. 5) Appliance PCs and appliance chips should be strong. Again, there's debate on how strong, but most sources I have read at least agree that the market is going to grow in the near future. I am, at this point, a long-range bull, but I'm minimally invested right now simply on trading decisions. AMAT's conference call will move the sector short-term. At least longs have been making money again recently.