Closed up across the board! U.S. storage and chip stocks surged, SK Hynix soared 27%, and IBM plummeted
[Introduction] All three major U.S. stock indexes closed higher, with storage and chip stocks soaring. SK Hynix soared 27%; IBM plunged more than 25%, the largest single-day decline in the company's 115-year history. China Fund News reporter Ivan said on July 14, Eastern Time, the U.S. CPI fell more than expected in June from the previous month. Superimposed on the strong performance of many financial and technology companies, the three major U.S. stock indexes fluctuated upwards, and finally closed higher across the board.
[Introduction] All three major U.S. stock indexes closed higher, storage and chip stocks soared, SK Hynix soared 27%; IBM plunged more than 25%, the largest single-day decline in the company's 115-year history China Fund News reporter Ivan On July 14, Eastern Time, the U.S. CPI fell more than expected in June from the previous month. Superimposed on the strong performance of many financial and technology companies, the three major U.S. stock indexes fluctuated upward, and finally closed higher across the board. As of the close, the Dow rose 0.02% to 52,508.27 points; the Nasdaq rose 0.9% to 26,107.01 points; the S&P 500 rose 0.38% to 7,543.59 points. Federal Reserve Chairman Warsh makes hawkish debut on Capitol Hill Before the market opened on July 14, Eastern Time, data released by the U.S. Bureau of Labor Statistics showed that the U.S. CPI rose by 3.5% year-on-year in June, and the core CPI rose by 2.6% year-on-year, which was significantly lower than the previous value and lower than market expectations. CPI fell by 0.4% month-on-month in June, the first month-on-month decline in six years, and the decline far exceeded market expectations of 0.1%. After the data was released, traders postponed bets on a rate hike by the Federal Reserve until October. On the same day, Federal Reserve Chairman Kevin Warsh attended the semi-annual congressional hearing for the first time since taking office. Warsh demonstrated a tough "hawkish" stance, bluntly stating "zero tolerance" for five years of high inflation, and clearly refuted the market view that the fight against inflation was "complete" due to the month-on-month decline in CPI in June. He announced that the Fed will establish five working groups to comprehensively review the current policy framework "starting with a blank sheet of paper." Faced with pressure from the Trump administration to cut interest rates, he refused to provide forward guidance, emphasizing that the Fed would insist on independent decision-making based on economic data. Storage and chip stocks surge SK Hynix surges 27% On July 14, Eastern Time, U.S. storage and chip stocks surged. SK Hynix soared 27%, the Philadelphia Semiconductor Index rose 2.54%, SanDisk rose more than 5%, Micron Technology rose nearly 5%, and Nvidia and Intel rose more than 4%. On the news, Wall Street institutions predict that Micron and the entire chip industry will create approximately US$700 billion in profits in 2027. Among them, Micron Technology is the representative of the most astonishing growth. Although its stock price fell by more than 4% last month, its net profit in fiscal year 2025 is only US$9 billion. It is expected to soar to US$83 billion in fiscal year 2026, and further reach US$176 billion in fiscal year 2027. The core driver of the surge in profits is the continued surge in demand for high-end storage chips (such as high-bandwidth memory HBM) from artificial intelligence. This, coupled with the acceleration of computing power such as NVIDIA GPUs, coupled with tight supply and long-term customer orders, directly drives the market to significantly increase its full-cycle profit forecast. However, the impact of the recent decline in stock prices has spread from Micron Technology to peers such as Samsung. The prerequisites for this growth trend include that AI capital expenditures remain high, memory chip prices remain strong, and the release of new production capacity is slow. JPMorgan Chase pointed out that the tight supply situation will continue and there will be no large-scale new production capacity before 2028. IBM plunges more than 25% It was the largest one-day drop in the company’s 115-year history. On July 14, Eastern Time, software stock IBM plunged more than 25%, the largest single-day decline in the company's 115-year history. Prior to this, the company's largest single-day decline in history occurred on "Black Monday" on October 19, 1987, when it closed down 23.7% that day. The company's preliminary second-quarter results before the bell showed revenue and profit below market expectations, with Chief Executive Officer Arvind Krishna admitting that it had been unable to adapt in time to dramatic changes in customer spending patterns. Among them, the decline in sales of the infrastructure business was particularly obvious, down 7%. Krishna admitted that the company failed to adapt quickly to the market, and that many large transactions failed to complete on schedule, which constituted a major part of the performance gap. He said these situations require flawless execution from the team, and there were missteps this quarter. (