U.S. chip equipment stock gains to be limited on valuation - JP Morgan H&Q

SAN FRANCISCO (AFX) - Near-term appreciation in the prices of semiconductor capital equipment stocks "are likely to be capped by current valuation levels," JP Morgan H&Q analyst Eric Chen said, cautioning investors not to expect "substantial near-term gains".	    "We continue to believe that growth in the equipment space will likely be flat to slightly down over the next two quarters.	    "We believe that we are near the bottom and thus maintaining a trading range thesis -- albeit with a positive bias," Chen said.	    Fellow JP Morgan analyst Brian Marshall said the brokerage's technology investor conference held last week "confirmed (his) belief that fundamentals improved in the month of April" for the semiconductor devices segment.	    Marshall said "demand is the wildcard and needs to improve dramatically to sustain the recent appreciation" in stock prices in that segment.	    "Valuations seem robust and are factoring in continued positive news flow," Marshall added.

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