Company forecasts were in focus last week, while semiconductor issues
endured several bouts of weakness. Leading the industry's slide was Texas
Instruments after it lowered its second-quarter forecast amidst lethargic chip
sales, impacted by SARS, to wireless customers. A rain of downgrades then
pummeled the group, as Morgan Stanley and Banc of America lowered their
stances on the industry due to valuation concerns. However, one standout in
the crowd was Micron Technology, which sees demand for personal computers in
the second quarter coming in higher than previously thought. "Micron came out
with positive comments, and the market took that as good news. When a
technology bellwether comes out and says that demand is better than thought,
it's positive for the market," said Jeff Swensen, senior trader at John
Hancock Funds, to Reuters News. Meanwhile, mobile-phone giants Motorola and
Nokia soured on bleaker outlooks. The SARS outbreak was again cited for sales
and earnings weakness at Motorola, while Nokia cautioned that its cellphone
unit's sales may fall under its forecasted wire, but to investors' relief, it
did not lower its earnings forecast. Hardware issues were not to be ignored
either. International Business Machines was an influential market force after
it was added to Merrill Lynch's Focus One list, while Dell Computer receded
after its chief operating officer commented he sees no pickup in demand for
technology. On the earnings front, software firms Oracle and Adobe Systems
both beat Street forecasts; however, Adobe warned that its third-quarter
earnings would fall slightly beneath the average analyst estimate. Looking
down the line, as chip stocks endured a recent reprimand for their runaway
shares, market watchers will be monitoring if the sector darlings turn bratty
and restrain the rest of the tech group.
High-Tech Monday Update is provided courtesy of Thomson Financial. This
information is believed to be true and accurate; we take no responsibility for
inaccurate information and reserve the right to update our reports. For more
information, please visit our web site at http://www.thomsonfinancial.com.
SOURCE Thomson Financial Corporate Group
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