The RF to Light dropped 1% last week, YTD + 11% at 2381. Communications service stocks continue to climb! This market segment moved from -12% in 4Q05 to +34%. Bell South, Comcast, AT&T, Time Warner and Verizon all hit new 52 week highs. The cable industry will spend > $2b a year by 2010 on infrastructure to move content seamlessly from TV to PC to mobile devices. Deutsche Telecom (T-Mobile), Time Warner, and Sprint Nextel are the value leaders (14, 26 and 38) compared to Comcast (141). Many 3Q06 financials beat expectations but stocks slip when companies forecast slowdown, example Texas Instruments and Corning.
Hittite Microwave shares plunged 26% after super earnings release (sell at good news, buy at bad news).
In the News: Housing and oil put brakes on the economy. US gross domestic product (GDP dropped to 1.6% in 3Q06. The Fed left 5.1/4% Fed Rate untouched as inflation pressure eased, dollar tumbled. China sets new high for Yuan versus Dollar. Airbus signs deal to establish assembly plant in China. Boeing has 787 weight problem, still on schedule mid 2008.
New Highs: AV, BLS, CMCSA, FLEX, HLIT, HPQ, LMT, MSFT, ROG, T, TWX, VZ
New Lows: BKHM, BRCM, JDSU
Market oversold indicator: up to 74%
Market overbought indicator: down to 50%
Top 5
Last week: Zhone (25%), LSI Logic (17%), Sprint-Nextel (11%), Endwave (11%), MRV (10%)
YTD: Broadwing (145%), Rogers (79%), Avici (79%), Finisar (79%), Atheros (69%).
Bottom 5
Last week: Hittite (-26%), HEI (-23%), Bookham (-13%), Andrew (-12%), Corning (-10%)
YTD: HEI (-51%), Powerwave (-48%), Bookham (-44%), Zhone (-40%), Vitesse (-39%)
by Sectors:
Space & Defense : -1%, YTD +15%
Communic. Systems : +2%, YTD +34%
Network Systems : -2%, YTD - 5%
RF Semiconductors : -2%, YTD + 4%
RF Components : -2%, YTD +13%
F/O Components : -2%, YTD +12%
Miscell. : -2%, YTD +11%
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RF to Light 100 : -1%, YTD +11%