TSMC's performance exceeded expectations, leading the rise of technology stocks.
On October 17th local time, the three major stock indexes of the US stock market fluctuated, with the Dow Jones Industrial Average reaching a new historical high. As of the close, the Dow Jones Industrial Average rose 0.37%, the Nasdaq rose 0.04%, and the S&P 500 index fell 0.02%. Spot gold and COMEX gold futures have both broken through historical highs.
Most large technology stocks have risen, with TSMC rising nearly 10% and its stock price reaching a historic high, with a market value exceeding $1 trillion; Nvidia's stock price hit a historic high during trading, with a total closing market value of $3.36 trillion.
TSMC's market value has exceeded $1 trillion, and its performance has exceeded expectations
On October 17th local time, the three major stock indexes of the US stock market fluctuated, with the Dow Jones Industrial Average reaching a new historical high. As of the close, the Dow Jones Industrial Average rose 161.35 points, or 0.37%, to 43239.05 points; The Nasdaq rose 6.53 points, or 0.04%, to 18373.61 points; The S&P 500 index fell 1.00 points, or 0.02%, to 5841.47 points.
Spot gold and COMEX gold futures have both broken through historical highs. Spot gold rose 0.71% to $2692.75 per ounce; COMEX gold futures rose 0.61% to $2707.6 per ounce.
The settlement price of international crude oil futures closed slightly higher. WTI crude oil futures rose 0.4% in November, while Brent crude oil futures rose 0.31% in December.
In terms of sectors, the 11 major sectors of the S&P 500 index fell six times and rose five times. The utility sector and communication services sector led the decline with a decrease of 0.93% and 0.69% respectively, while the energy sector and technology sector led the rise with an increase of 0.44% and 0.42% respectively.
TSMC's performance exceeded expectations, leading the rise of technology stocks. TSMC rose nearly 10%, its stock price reached a historic high, and its market value exceeded $1 trillion. Broadcom, Micron Technology, and ASML rose over 2%, Dell Technologies and ARM rose over 1%, while Nvidia, Intel, Amazon, Dow, Apple, Microsoft, AMD, Cisco, and Meta rose slightly; Tesla and Qualcomm fell slightly, Google A fell more than 1%, and Netflix and AMD fell more than 2%.
TSMC closed up 9.79%, with its stock price reaching a historic high of $200 per share and a market value exceeding $1 trillion. The company's third quarter performance and fourth quarter performance guidance both exceeded expectations, indicating that AI demand remains strong.
Specifically, TSMC's net profit for the third quarter reached NT $325.3 billion, a year-on-year increase of 54%, compared to the previous market estimate of NT $299.3 billion; The operating revenue for the third fiscal quarter was NT $759.7 billion, a year-on-year increase of 39%, while the market estimate is NT $751 billion. Earnings per share were NT $12.54, a year-on-year increase of 54.2%.
In terms of performance guidance, TSMC expects fourth quarter sales to be between $26.1 billion and $26.9 billion, exceeding market estimates of $24.94 billion; The expected gross profit margin for the fourth quarter is 57% to 59%, while the market estimate is 54.7%; Calculated in US dollars, TSMC expects its sales for the full year of 2024 to increase by nearly 30%, a significant increase from the previously estimated maximum growth rate of around 20%. TSMC stated that it expects capital expenditures to be slightly above $30 billion in 2024, and capital expenditures in 2025 are likely to be higher than in 2024.
Nvidia closed up 0.89%, with its stock price hitting a historic high during trading, closing at $136.93 per share, with a transaction volume of $42.493 billion and a total market value of $3.36 trillion. According to The Information, with the surge in demand for AI chips, the partnership between Nvidia and TSMC, the chip allies, is facing increasing performance pressure due to production issues, following the recent delay in production of Nvidia's new Blackwell chips.
According to two insiders, in the weeks after Nvidia released the Blackwell chip, Nvidia engineers found that the chip malfunctioned in the high voltage environment commonly found in data centers during testing, and some of the problems may have originated from defects in the chip's design.
Bank of America Global Research has raised its target price for Nvidia's stock price to $190 per share - meaning there is a 39% upside from the latest closing price, previously $165 per share; Maintain a 'buy' rating.
Micron Technology closed up 2.57%. Micron Technology announced on Wednesday the launch of a new category of memory modules, including CUDIMM and CSODIMM, which have already been shipped in bulk. The new product meets the standards of JEDEC Solid State Storage Association, with a data transfer rate of 6400MT/s, which is 15% faster than traditional DDR5.
Tesla closed down 0.20%. According to sources cited by the media, the European Union has issued a warning to the social media company X, owned by the world's richest man Elon Musk. When calculating the fine for the X platform, it may also include the income of other companies under Musk's command, such as space exploration technology company SpaceX, which means that the amount of the fine will increase significantly.
As the world's most famous serial entrepreneur, Musk has several star companies under his umbrella, including the top electric vehicle giants Tesla and SpaceX, as well as brain computer interface company Neuralink, artificial intelligence company xAI, and underground tunnel company The Boring Company. He also acquired X platform (then known as Twitter) in October 2022.
In terms of other stocks, streaming media giant Netflix's US stock rose after hours, with a rise of over 5% as of press time. Netflix released its third quarter financial report on Thursday, with both revenue and profit exceeding expectations, and its advertising business continues to maintain its growth momentum.
Netflix's Q3 EPS was $5.4, with analysts expecting $5.12; In the third quarter, the net increase in paid streaming users was 5.07 million, with analysts expecting an increase of 4.52 million.
Netflix predicts that the number of new paid users in the fourth quarter will be higher than in the third quarter. Revenue is expected to increase by 15% in the fourth quarter of 2024; The expected operating profit margin is 22%, a year-on-year increase of 5 percentage points; The fourth quarter guidance indicates that revenue for the full year of 2024 will increase by 15% year-on-year, which is at the high end of the previous revenue growth expectations of 14% -15%; Expected revenue for the fiscal year 2025 is between 43 billion and 44 billion US dollars, with a market expectation of 43.42 billion US dollars.
On October 17th Eastern Time, Pony. ai, a Chinese unicorn in the field of autonomous driving, officially applied for a US IPO with the US Securities and Exchange Commission (SEC), seeking to trade its ADS on NASDAQ under the code "PONY". Xiaoma Zhixing is expected to become the "world's first Robotaxi stock".
Most popular Chinese concept stocks fell on Thursday. The Nasdaq China Golden Dragon Index (HXC) closed down 3.61%. Youke Factory rose by over 13%, while Shuidi, NetEase Youdao, and Sohu rose by over 1%. Xiaomi Group (ADR) and Yixian E-commerce saw slight increases; Fangduoduo fell more than 20%, Beike fell more than 11%, Huya fell more than 10%, Miniso and Xiaopeng Motors fell more than 7%, NIO and 36Kr fell more than 6%, Futu Holdings, Bilibili, Weibo, Ideal Automobile, Zhihu fell more than 5%, Dingdong Maicai, Century Internet, JD fell more than 4%, iQiyi, Faradi Future, Baidu fell more than 3%, Pinduoduo, Gaotu, Douyu, NetEase, Zhongtong Express, Yihang Intelligent, Manbang, Ctrip, Noah Wealth, Wuxin Technology, Alibaba fell more than 2%, New Oriental, Baozun E-commerce, Hesai, Tuniu, and TAL Education fell more than 1%.
The 'terrifying data' exceeds expectations, and the Federal Reserve's interest rate cut expectations are hit again
In terms of economic data, the growth rate of US retail sales, known as the "terrifying data", shows that the economy is still on track. This may not prevent the Federal Reserve from cutting interest rates next month, but the magnitude of the rate cut is bound to decrease.
The data released by the US Department of Commerce on Thursday showed that retail sales in September increased by 0.4% month on month without adjusting for inflation, higher than the 0.1% increase in August. Excluding sales from cars and gas stations, retail sales increased by 0.7%.
The retail sales data for September exceeded expectations, supporting the view that the economy will maintain strong growth in the third quarter. The signs of economic recovery may not prevent the Federal Reserve from cutting interest rates again next month, but will strengthen expectations of a 25 basis point rate cut.
Another piece of data shows that the number of first-time jobless claims in the United States unexpectedly decreased last week, following a surge in applications in the southeastern states affected by Hurricane Helen in the previous week.
According to data released by the US Department of Labor on Thursday, the number of first-time jobless claims decreased by 19000 to 241000 for the week ending October 12th. The median forecast of surveyed economists is 259000 people. In the week ending October 5th, the number of people continuously applying for unemployment benefits increased to 1.87 million, reaching the highest level since July.
US Treasury Secretary Yellen stated that the US GDP growth is strong, the unemployment rate is close to historical lows, and inflation has significantly decreased. We are currently making every effort to reduce the costs for American families.
According to the Chicago Mercantile Exchange's Federal Reserve Watch tool, the market currently expects a 92.1% chance of a 25 basis point rate cut at the Fed's next meeting, and a 7.9% chance of keeping interest rates unchanged.
In terms of overseas central bank news, the European Central Bank announced its third interest rate cut this year on Thursday. Due to the accelerated decline in inflation, the European Central Bank has provided support for the struggling economy through interest rate cuts.
The European Central Bank has lowered its key deposit rate by 25 basis points to 3.25%, in line with the expectations of all analysts surveyed by Bloomberg. The European Central Bank stated that the process of controlling inflation is progressing smoothly, but did not provide any clues about when or how quickly interest rates will be lowered in the future.
Insiders say that European Central Bank officials believe that with inflation stabilizing at 2% faster than expected, there is a high possibility of another interest rate cut in December.