Semiconductors are the building blocks of modern electronics -- they are in everything.
Semiconductor devices, electronic components made of semiconductor materials, are essential in modern consumer electronics, including computers, mobile phones, and digital audio players. Silicon is used to create most semiconductors commercially, but dozens of other materials are used.
So when a semi conductor manufacturer says they are idling plants you know there is trouble ahead:
Toshiba Corp (6502.T: Quote, Profile, Research, Stock Buzz), the world's No. 2 maker of NAND flash memory, will halt chip production at two plants for nine days due to weak demand, in its first output break in seven years, broadcaster NHK reported on Friday.
Toshiba shares rose nearly 3 percent after the report, but company spokeswoman Hiroko Mochida denied that it planned to temporarily shut down all operations at the factories in Yokkaichi, in western Japan, and Oita, in southern Japan.
As this chart of the semi conductor's trust indicates the industry is not immune from the current market problems.
Click for a larger image.
Notice the following on the one year chart:
-- Prices are near a one year low
-- Prices are below the 200 day SMA
-- All the SMAs are moving lower
-- Prices are below all the SMAs except the 10 day SMA
The reality of the situation is this slowdown is broad and wide.