Is this the end of the tech rally?

JOHANNESBURG, SOUTH AFRICA: RothmanResearch.com probes the market trends to provide members with insight on tech stocks like Taiwan Semiconductor Co. Ltd. and Broadcom Corporation.

The second quarter 2010 has so far been a great run and tech stocks have received a mega boost from the earnings feat Intel served a few days back. However, looking at after market trades, it would seem that investors are slowly losing that optimistic momentum as they ponder industry experts' skepticism that the technology sector is weakening with signs that the PC market is heading in the wrong direction.

It looks like the rally is already fading away for tech stocks. Nevertheless, today's corporate development from Taiwan Semiconductor Manufacturing Co. Ltd, the world's top contract chipmaker, could ignite investors' interest once more.

Taiwan Semiconductor, whose clients include a number of fabless high-tech companies like Broadcom Corp., Qualcomm, Marvell and many others, announced today that it is planning to invest $9.4 billion in a new plant in Taiwan. The company is expecting to deliver record profits in 2010 and is set to release its earnings for this quarter at the end of July.

"Following Intel's robust second quarter readings which left Wall Street analysts dumbfounded, investors might have a tendency to anticipate similar results from other semiconductor players in this space," commented Mathew Collier of Rothmanresearch.com.

"However, we would like to remain cautious and not read too much into Intel's overwhelmingly positive results. The best approach at this time is to evaluate the trend with upcoming earnings from other players in this industry before taking a long-term stance."