Late at night, violent selling! Memory chips plummeted across the board! Buffett rarely speaks out
U.S. stock memory chips suffered another sell-off. Tonight, after the U.S. stock market opened, semiconductor, storage, and optical communications concept stocks collectively plummeted. The Philadelphia Semiconductor Index once fell by more than 3%, SanDisk once fell by more than 9%, and SK Hynix ADR once fell by more than 8%. Some analysts warned that there are currently cracks in U.S. chip stocks, and a strong and sustainable rebound must occur as soon as possible, otherwise it will pose a real threat to the stock market. At the same time, U.S. stock investors are continuing to digest the pressure of overvaluation of some technology stocks. U.S. chip stocks plunge across the board On the evening of July 16th, Beijing time, after the U.S. stock market opened, the trends of the three major indexes diverged. As of 22:20, the Dow rose 0.08%, the Nasdaq fell 0.63%, and the S&P 500 fell 0.12%. Large technology stocks had mixed gains and losses. Broadcom fell by more than 2%, Nvidia and TSMC ADR fell by more than 1%, and Meta fell slightly; Apple, Google, Microsoft, Amazon, and Tesla rose slightly. U.S. chip stocks generally fell. The Philadelphia Semiconductor Index fell nearly 3%, Arm fell more than 6%, ON Semiconductor and Qualcomm fell more than 4%, and Intel, AMD, and Texas Instruments fell more than 3%. Memory chip stocks fell sharply across the board, with SK Hynix ADR and SanDisk falling more than 6%, Western Digital and Seagate Technology falling more than 5%, and Micron Technology falling more than 3%. The optical communications sector of the U.S. stock market opened lower and moved lower. Corning fell more than 6%, Marvell Technology fell more than 5%, and Lumentum, Coherent, and Credo fell more than 3%. On the news, TSMC’s latest second-quarter results were better than expected, but the impact of its upward revision of capital expenditure forecasts overshadowed the positive financial report. TSMC expects capital expenditures this year to be between US$60 billion and US$64 billion, higher than its previous guidance range of US$52 billion to US$56 billion. At the same time, TSMC confirmed that it will invest an additional US$100 billion in Arizona, USA, further increasing its commitment to the US market. Ricky Ho, a fund manager at Singapore's Four Capital, said that the current market expectations for TSMC are already at "abnormally high" and that further stock price increases in the future will increasingly rely on management to continue to exceed market expectations. In addition, during today's Asia-Pacific trading session, the share prices of Korean memory chip giants SK Hynix and Samsung Electronics fell sharply, closing sharply down 11.53% and 8.77% respectively. Some analysts pointed out that one of the triggers of this round of selling was the violent fluctuations caused by domestic leveraged ETF products in South Korea. Judging from the latest actions of the South Korean government, it seems that it is intending to squeeze the bubble and reduce leverage. In the long term, the demand in the AI industry is still strong, the gap in storage demand is still large, and the fundamentals of the industry have not changed. Matt Maley of Miller Tabak warned: "The trend of chip stocks remains the most important issue in the U.S. stock market. They do have some obvious cracks, so a strong and sustainable rebound must occur as soon as possible, otherwise it will pose a real threat to the stock market." At the same time, U.S. stock investors are continuing to digest the pressure of overvaluation of some technology stocks. The capital expenditures of the four major AI giants such as Meta, Google, Microsoft, and Amazon are expected to exceed US$725 billion this year. The market has intensified concerns about the wave of data center construction and the uncertainty of the return cycle. In terms of macro data, according to data released by the U.S. Census Bureau on Thursday, total retail sales increased by 0.2% month-on-month in June, in line with market expectations. The previous May data was revised upward to a month-on-month increase of 1%. The sharp decline in gas station sales became the main drag for the month. However, excluding gas stations, retail sales increased by 0.7% month-on-month, showing that the endogenous dynamism of consumer spending is still strong. At the same time, "Stock God" Warren Buffett's rare statement also attracted market attention. On July 15, local time, Buffett bluntly stated in an interview with CNBC host Becky Quick that when everyone is keen to "gamble" on topics such as AI, it is becoming "increasingly difficult" to find truly valuable investments. He compared the current U.S. stock market to a "church with a casino" and criticized the explosive growth of single-day options trading as pure gambling.
The current market backdrop confirms his concerns. U.S. stocks have risen to record highs this year, with retail investors pouring in on a large scale to buy popular targets such as memory chip manufacturer Micron Technology and the recently listed SpaceX. At the same time, stocks related to AI construction have been questioned for excessive speculation, and tools such as options and leveraged ETFs have further amplified market fluctuations. At the same time, Buffett made it clear that Google is "more likely to be a winner than 90% to 95% of the stocks promoted by Wall Street" and personally admitted that this investment was initiated by him. He also pointed out that Google’s capital expenditure plan this year is as high as 180 billion to 190 billion US dollars, and will continue to increase in 2027. This scale far exceeds any investment in the history of the railway industry. Buffett also admitted a historic mistake - he admitted that it was a mistake to miss Google in its early stages when operating costs were lower and valuations were cheaper.
The current market backdrop confirms his concerns. U.S. stocks have risen to record highs this year, with retail investors pouring in on a large scale to buy popular targets such as memory chip manufacturer Micron Technology and the recently listed SpaceX. At the same time, stocks related to AI construction have been questioned for excessive speculation, and tools such as options and leveraged ETFs have further amplified market fluctuations. At the same time, Buffett made it clear that Google is "more likely to be a winner than 90% to 95% of the stocks promoted by Wall Street" and personally admitted that this investment was initiated by him. He also pointed out that Google’s capital expenditure plan this year is as high as 180 billion to 190 billion US dollars, and will continue to increase in 2027. This scale far exceeds any investment in the history of the railway industry. Buffett also admitted a historic mistake - he admitted that it was a mistake to miss Google in its early stages when operating costs were lower and valuations were cheaper.