Perhaps no sector has been hit harder this year than chip stocks, off more than 20% from their January peak, so Taiwan Semi’s announcement Monday night that it is increasing capital spending came as welcome news to the sector.
Taiwan Semi, one of the world’s biggest chip makers, said its capital spending could exceed its $2 billion target for 2004 by 10% due to overcapacity.
With chip equipment spending so far lagging the broader economic recovery, investors took the announcement as good news, sending stocks like Applied Materials and KLA-Tencor
to 3% gains on Tuesday.
Chip stocks were one of the stronger sectors on a mixed day for the market, as investors tried to figure out whether it was good news or bad news that the Federal Reserve plans to raise interest rates gradually.
The Nasdaq rose 11 to 1950, the S&P 500 added 2 to 1119, and the Dow tacked on 3 to 10,317. Volume rose to 1.67 billion shares on the NYSE, but declined to 1.86 billion on the Nasdaq. Advancers led 19-13 on the NYSE, and 18-12 on the Nasdaq. Upside volume was 63% on the NYSE, and 67% on the Nasdaq. New highs-new lows were 63-127 on the NYSE, and 56-48 on the Nasdaq.
Macrovision soared 29% after beating estimates, and Vishay
jumped 7% on its results.
Nortel surged 17% on a VoIP deal.
HP and BT
rose on a $1.5 billion deal.
Siebel slipped 2% on a change at the top.
Priceline rose 2% after beating estimates, and Quantum
and eSpeed
gained on their results.
Intelligroup plunged 32% on a warning.
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