Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
VXN just closed above its upper BB for the 4th consecutive day. This hasn't happened for at least 2 years....and probably much longer (my stockcharts stopped working in the middle of looking at this).
Insider sales ratio slowing a bit in Nov. so far, still high:
http://insider.thomsonfn.com/tfn/insider.asp?imodule=mktTearsheet
Zeev,
You have my sympathies, sounds like a little problem I had a few years back. If you want to get to the bottom of this (if my inference is correct), might I recommend one Dr. Shelito at Mass General (assuming he's still there), aka "The Boston Strangler" <g> ...he is Da Man.
Interesting trading comment from Goldman Sachs today:
"In derivatives markets, we have seen big index exposure for sale. In particular, medium-sized SPX call selling and large SPX puts buying."
Stock is definitely not cheap. Hey, don't look at me <g>...I don't own it. I'm slightly net long the equipment group, but they all look overvalued to me.
There was a question on the call on your exact point. Management implied that, yes, Q2 should have very strong revenues.
I was surprised that there were not questions on the flattish backlog in the face of such strong orders. This implies some cancelations in the mix. The other big issue is margins...sooner or later this company had better start to make some real money (and it doesn't look like it's going to happen in Q1). But otherwise, this was a very strong quarter, no question.
They meant 20% on top of the quarter they just reported. (eom)
Sell-side commentary of note this morning:
Lots of positive chatter on IACI's analysts meeting yesterday.
Deutsche Bank says semi industry demand strengthening significantly and lead times expanding. Upgrades STM.
For the retail buffs, AG Edwards and Prudential downgrade ANF after earnings last night.
SC
As usual, orders and guidance will be key. I think AMAT had a very good quarter. Not sure it's all in the stock yet, but the equipment group today is clearly reflecting some good news coming.
VIX and VXN tagged their upper BB's today, which suggests at least a relief rally soon.
TSM
Goldman is saying good demand for the shares, deal is 60% done already and will likely price tonight.
Slowing DRAM sales
http://www.ebnews.com/showArticle.jhtml;jsessionid=IROPHCU4G1YGUQSNDBGCKHY?articleID=16000613
Shipments of DDR SDRAM slowed in October and remain at unseasonably low levels this week, according to analysts.
While the effect on pricing could be measured in pennies, the timing was unsettling: typically, the holiday rush in the fourth quarter represents a major portion of yearly demand for DRAM makers.
"Current DRAM shipments are far below historical levels," said Nam Hyung Kim, an analyst with iSuppli Corp., El Segundo, Calif. "Increasing PC unit sales don't seem to [translate to] more DRAM consumption, resulting in lower-than-expected DRAM shipments."
November will be the "make or break" month for pre-holiday DRAM shipments, said Jim Elliott, senior DRAM marketing manager at Samsung Semiconductor Inc., San Jose. However, up to now, Samsung has seen no slowdown in demand.
"We had an awesome October," Elliott said.
Heavy demand for NAND flash products meant DRAM had to compete for wafer starts on Samsung's fab lines, he said.
"We had a run on DDR400 and 512-Mbit monolithic DRAM," Elliott said. "It has been a struggle to keep up with demand from high-end desktops, workstations, servers, and some high-end notebooks."
Demand issues appeared to be more pronounced at suppliers with a greater mix of mainstream commodity DRAM.
Some observers attributed the sluggishness to an LCD shortage that is putting the brakes on PC manufacturing lines. Others said customers are simply waiting longer to purchase components like DRAM.
"It's not that they're delaying builds, but from a DRAM perspective, we have controlled inventory better than in the past," said Dan Donabedian, president of Elpida Memory Inc. USA, Santa Clara, Calif. "I would expect to see a more distinct pickup within the next couple of weeks because of that."
Ordinarily, a deceleration in DRAM orders may have a more dramatic effect on pricing. However, memory manufacturers have recently taken steps to limit DRAM production and avoid flooding the market, according to iSuppli's Kim.
For example, Samsung's 2003 DRAM fab output will increase only 35% year-over-year, since the company shifted a portion of its DRAM production lines to NAND flash. Samsung's 2002 year-over-year output increase was nearly 90%, he said.
Additionally, Hynix Semiconductor Inc. recently announced it would stop selling parts on the spot market to help stabilize prices.
After minor fluctuations throughout October, spot market prices last week rose slightly, according to Clark Westmont, an analyst at Smith Barney, San Francisco. In a report, Westmont said DDR400 showed a 4% increase to an average of $4.49, DDR333 was up 2% to an average of $4.33, and DDR266 was down 1% to $4.30.
The DRAMeXchange, meanwhile, reported that contract pricing for DDR SDRAM in the second half of October declined 3.5% to a range of $5.06 to $5.50 for DDR400 and $4.88 to $5.19 for DDR333.
iSuppli's Kim forecast contract prices will dip further in November.
>>> Money supply continues to collapse.
Coming out of money market funds and going into the stock market, I think.
>>>> FNM. That was such a buyable dip
I did buy it on the dip, flying blind. My reasoning was that that if the news had been bad and material, they would have asked to have the stock halted. I am holding what I bought, as I think the computational error is no big deal (these things happen), it is after all a positive revision, and I therefore think the stock should get back to at least flat. JMO
TSMC upped capex guidance. (eom)
Yes, they just did...not a good sign
Important test of support right here...COMP, NDX, SPX all right at 50 day SMA
NEM at 6-year high
INTC's capex guidance was for 2003, which of course is almost over. They won't issue capex guidance for 2004 until January. But they did reiterate their committment to remain "capital efficient". You are right, this is negative for equipment. It also has positive implications for INTC's margins, since depreciation is the lion's share of COGS (material cost is insignificant), and suggests that INTC's peak margins could exceed the previous cycle peak.
Nothing but positive analysts' comments on INTC and NVLS this morning so far, except one negative view from First Albany on NVLS. I personally was not impressed with the NVLS results or guidance.
Also, ASML reported a blowout order number last night. This is a very positive data point for the industry, as much of the upside was driven by 300 mm and capacity (rather than technology) buys.
Excellent INTC quarter. But margins may be approaching a cyclical peak. Historically, one would have made a lot of money by simply buying INTC when the margins are in the 40's and selling when they are in the 60's. Still, maybe we have a few more quarters of rising margins.
yes, and Q4 bookings guidance was just in line. Given the backdrop (seasonality, cyclical recovery, in line Q3 base) and heightened expectations, this has to be considered a disappointing quarter. But the AH reaction is telling and has bullish implications for the market, IMO. We'll see what the sell side reaction to the NVLS quarter is tomorrow.
Zeev, took advantage of the "buying opportunity" on FCX...and got very lucky indeed. Having sold half my position above 37 yesterday (just to take profits), I tried to buy this back at 34.10 (the ask on my system). Much to my surprise, I got filled at 33.65. This NEVER happens to me. <ggg>
FCX, bad news / good news
NEW ORLEANS--(BUSINESS WIRE)--Oct. 9, 2003--Freeport-McMoRan Copper & Gold Inc.(NYSE:FCX - News) today reported that on the morning of October 9, 2003, a slippage of material occurred in a section of the Grasberg Open Pit Mine in Papua, Indonesia operated by its affiliate, PT Freeport Indonesia (PT-FI).
Regrettably, two employees were fatally injured and six other workers are presently unaccounted for. Five other employees are being treated for injuries. Efforts are ongoing to locate the missing workers and to ensure the safety of PT-FI's work force and operations.
James R Moffett, Chairman and Chief Executive, and Richard C. Adkerson, President, stated, "Our first priority in responding to this unfortunate event is to take actions to provide for the safety of our people, to care for those injured and to locate those who are missing. We extend our heart-felt sympathy to the families of those who perished. While the physical damages to our operations are not large, we reiterate our commitment to provide for the safety of our operations for all our employees who have worked so hard over the years to achieve success in our PT-FI organization."
Preliminary assessments indicate that PT-FI's mine plans for the fourth quarter of 2003 will be affected by this incident, resulting in the potential deferral of a portion of the metal previously forecast to be produced in the fourth quarter 2003 into 2004. The incident is not expected to affect PT-FI's long range mine plans.
FCX copper and gold sales to be reported in its third quarter earnings release on October 16, 2003, will exceed previous estimates. Copper and gold sales for the third quarter approximated 345 million pounds of copper and 764,000 ounces of gold, approximately 25 million pounds and 120,000 ounces higher than previous estimates. For the year-to-date period through September 30, 2003, FCX has sold approximately 1.13 billion pounds of copper and 2.2 million ounces of gold, approximating 80% of its 2003 previously reported copper sales estimate of 1.4 billion pounds and 85% of its gold sales estimate of 2.6 million ounces.
Bear:
>>MU...Bought some at $12.93 <<
...Why? Chart looks crappy to me, and fundamentals just ok, IMO.
BTW, congrats on FCX, and thanks.
chelsea
BVF is interesting from a longer-term perspective. The stock is cheap, the pipeline looks promising, and the Welbutrin product launch looks too powerful for even this management team to screw up. Having said that, these guys continue to find creative ways to suprise on the downside. Today has all the hallmarks of massive capitulation...big down volume on a "mere" sell side report that is essentially a rehash of everything everyone already knew was wrong here. Even so, better to wait for this thing to settle down, even if you have to buy it a few points higher. Keep it on your screen and revisit in about a month.
aj
What about the following simple scenario (for simple-minded people like me)? Sorry, I could not get the annotations to stick, and am too tired to keep trying:
http://stockcharts.com/def/servlet/SC.web?c=$compq,uu[h,a]daclyyay[pb50!b200!f][vc60][iUb14!Lp14,3,3...
Assuming we are in B up, 1850 is the 50% retracement, and from there we bottom at 1720, where A = C. Then on to new highs.
One other thing...I just realized the other day that the 38.2% retracement of the entire move down from the March-00 top is 2650! Seems incredible that we would ever get there, but maybe this cyclical bull has further to run than most think.
I have no idea, John...it may be a disappointment to some, but maybe that is what is already being discounted in the price this past week?
ALTR:
Lehman cut numbers a few days ago, citing weakness in the new product during the last 2 weeks in September. I personally think they report in line and also guide in line, FWIW.
Punkle,
Yes they did sound pretty upbeat, although I didn't hear anything about their capital spending plans (but I missed about 10 min. of the call). I think the money they got from INTC has to be a plus for their spending, all else being equal. And MU is expected to be one of the important sources of equipment orders in Q4 and Q1, although the biggies are Samsung and TSMC, and maybe INTC.
Bullish for MU...they need the cash. Also an indication that a deep-pocketed partner believes in them. Incidentally, I think that these are rights, that behave like a warrant or option. Intel can get their money back if the stock falls.
The conference call also sounds positive to me.
yayaa,
I think it already has. Didn't Goldman or MS say something negative about equip a few days ago? I think we'll see more of that in the weeks to come, and especially when companies report...all IMHO of course.
Some very recent order cancellations in semi equipment land. Business is weakening the past few weeks.
aj, what do you make of the VXN today?
http://stockcharts.com/def/servlet/SC.web?c=$VXN,uu[h,a]daclyyay[pd20,2!f][vc60][iUb14!Lp14,3,3!Ll14...
VXN down big today:
http://stockcharts.com/def/servlet/SC.web?c=$VXN,uu[h,a]daclyyay[pd20,2!f][vc60][iUb14!Lp14,3,3!Ll14...
Must be a mistake...otherwise, very bearish.
Zeev,
A question on the mechanics of your trading, when you have a chance. I generally avoid stocks with large bid/ask spreads, such as NVEC which was just trading at a spread of 0.40. How do you trade these? Do you wait until the spread narrows, favor either the bid or ask, or simply enter a price you consider attractive and wait for it to hit? I almost never daytrade, but sometimes I get the urge <g>. TIA.
and gold +4.5, Nas -9...what's going on? haven't seen any news.
Will,
For an alternative point of view, see this two year old video featuring Milton Friedman:
http://www.uncommonknowledge.org/00fall/526.html
(warning: it is 1/2 hour long, but well worth the time, imo)
It is mainly about government surplus and deficit, but he also devotes some time to addressing the shortcomings of the Keynesian approach. Among other things, he points out that Japan has tried large fiscal stimuli on at least four occasions during its decade long funk, with absolutely no success.
Goldman Sachs comments on software (published after close on Friday)
BUSINESS 'ACTIVITY' IS PICKING UP
Business activity appears to be improving in the software sector, but let's
be clear what we mean and also examine some of the data points.
Enterprise spending on IT was in a state of paralysis last year given the
uncertainties over the US economy. The exception was the seasonally strong
fourth quarter, which benefited from the normal year-end budget flush.
Under-spending budgets was typical as pressures grew to curb costs. This
continued into the first quarter of this year, as organization adopted a go
slow or wait and see approach to spending their budgets. This began to
change in the June quarter. Evidence of improving economic conditions has
grown and the stock markets seem to have signaled that it is becoming safe
again to spend budgets with more confidence that the economic environment
is no longer in immediate peril. We have come from a 'just say no to IT'
spending mentality to a view that maybe it is okay to think more
strategically again and spend the budgets with a bit more confidence. Our
recently released IT spending survey showed that IT budgets are still being
under-spent, but not nearly to the degree observed last year. We are
hearing of a more broad-based recovery in the US economy and evidence that
spending is beginning to free up seems to be coming from a broader range of
industry vertical markets.
Systems integrators tell us that interest levels are increasing and
previously shelved projects are being pulled back off the shelf. Some
integrators tell us they are beginning to hire again selectively. Interest
levels in upgrading software and in new projects for ERP and CRM are
increasing. Pipelines are strengthening, in some cases this is
characterized as increasing in size and in others as being more solid.
Zeev
Adam Hamilton at Zeal offers one of the better arguments for the gold bulls IMO - negative real rates.
http://www.zealllc.com/essays.htm
For those who don't want to take the time (takes forever to load and is quite verbose), I'll summarize: real interest rates (1-year Treasury minus cpi) are currently negative. As long as bond investors are virtually guaranteed a negative rate of return, especially after taxes, money will flow to gold, which at least can be expected to keep up with inflation in the long term.