Market Report- Memory chip blues

The financial crisis has slammed demand for memory-hungry gadgets like PCs
and digital cameras, with chip prices falling around 90 percent in the last 18
months. Memory chip makers, battered by falling prices and electronics
demand, look for bank and government aid in the worst industry downturn
ever.
Asian chipmakers have been battered by falling prices and electronic goods
demand, but shares of Hynix Semiconductor jumped Wednesday on ideas of
imminent aid.

Top shareholder Korea Exchange Bank and other lenders are in talks with the
DRAM chip giant to provide about $560 million in fresh funds, allowing it to
stay afloat.

The rare good news comes as the financial crisis hits demand for
memory-hungry gadgets like PCs and digital cameras, creating the worst chip
downturn in history.

Shares of firms like Hynix have plummeted about 70 percent this year, while
the price of 1 gigabit of memory has fallen from over $6 to around 61 cents in
the last 18 months.

Rival Samsung, the world No.1 in DRAM and NAND flash memory, is expected to
post losses but gain market share as other firms struggle.

Toshiba, the No.2 NAND player, is halting chip production at two plants for
over a week, the first such move in seven years, while planning to
restructure.

Others, such as ProMos, the smallest of Taiwan's top three DRAM makers, are
applying for government assistance amid the downturn, lifting shares
Wednesday.

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