The RF to Light 100 dropped 1.6% last week, YTD + 13% at 2465. While an excellent year overall, space & defense and communications services were the market segments to be in. 2007 should be another good year for business: I assume hardware spending will continue on a high level for space & defense applications. The internet, global communication, HDTV, the need for the telecoms to offer TV services, require more secure fiber optic lines to handle increased traffic. There are 600 mobile phone carriers in the world who need to sell phones and build infrastructure. However, average revenue per phone user appears to have peaked and 3G technology in Europe has not enticed consumers to spend more. The pressure is on to find "killer" - or profitable niche applications or merge to grow. As most of us manufacture and sell hardware, competition from China is a real threat to our business. It is also a tremendous opportunity if you have what they need - even if you lose some portion of your business to them. The stock market finished its 5th bull market year. The US economy most likely will grow modestly in 2007 and corporate profits may be less. Hopefully, January & February results will give us some indications for the year.

PIS (personal investment system):

5 year low: Solectron joined
2 year low: EDO, Sanmina joined
5 year high: Teledyne dropped out
2 year high: Anadigics dropped out

In the news: Continuing concerns over the US economy, GDP dropped to 2.0%, durable goods orders tumbled, brought out the sellers. Tame inflation data were probably old news.

New Highs: AV, COL, CSCO, DT, ERIC, HPQ, IBM, IFX, MSFT, RTN, TWX, TYC
New Lows : HEII

Market oversold indicator : up to 72%
Market overbought indicator: down to 49%

Top 5:

Week: Nortel (13%), Stratex (5%), ATC (3%), Tyco (3%), HP Compaq (3%)
YTD : Broadwing (158%), Avici (101%), Bell South (70%), Amkor (67%), MRV (67%)

Bottom 5:

Week: Jabil (-12%), Skyworks (-11%), Hittite (-10%), Anadigics (-9%), Sirenza (-8%)YTD : HEII (-62%), Vitesse (-52%), Powerwave (-49%), Zhone (-39%), ADC (-35%)

By Sectors:

Space & Defense : 0%, YTD +21%
Communic. Services: -1%, YTD +37%
Network Systems : -1%, YTD - 4%
RF Semiconductors : -4%, YTD + 4%
RF Components : 0%, YTD +18%
F/O Components : -3%, YTD +19%
Miscell. : -2%, YTD +12%
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RF to Light 100 : -2%, YTD +13%