Investors will be scanning for any hopeful bits of information on the second half when lead chip-equipment vendor Applied Materials ( AMAT) delivers its earnings report after the market close Tuesday. But it's not clear the company can oblige, with many analysts seeing ho-hum demand.

"We were inclined to scale back our position a little bit out of concern that there's not much likelihood of a big upside in terms of the current report and outlook for the next quarter," says John Leo, manager of the ( NTCHX) Northern Technology fund, which has recently trimmed its AMAT holdings. "The group has had a pretty nice run here of late."

Year to date, Applied has gained 21%, based on Monday's close of $15.72.

The price gains in Applied and other chip-related plays have given rise to some nail-biting. Though analysts kicked off the year with predictions of a broad second-half pickup in the tech business, that forecast is looking shakier, given persistent weakness in the economy. For the second quarter, Wall Street expects Applied's sales to slide 4% from year-ago levels, with earnings also down a penny.

Revenues should total $1.1 billion, with pro forma earnings of 2 cents, according to consensus forecasts from Thomson First Call.

As it stands, analysts have bet that AMAT can compensate for a weak first half of its fiscal year 2003 with robust sales growth in the remaining July and October quarters. Wall Street expects sales in the final two quarters to grow 15% from the first two quarters.

But with sales momentum at AMAT still looking weak -- barring any unexpected upside in management's forecasts -- the situation evokes unsettling comparisons with the spring of '02.

Back then, Wall Street was forced to backpedal from cheery predictions of a broad second-half pickup. Leading tech stocks like AMAT responded with steep price dives. The stock lost more than half its value in 2002, between its April peak of $27.76 and its October low point of $10.35.

"It does seem to be a replay in some respects," acknowledges Leo.