In the past two weeks, the S&P 500 index once again hit a record high after two years, and the quality of this round of gains will also face a high-intensity test next week (January 29-February 2). As background to this article,Although it is true that the S&P 500 index hit a new high, in fact, among the 11 sector indexes subdivided, only the information technology index, which includes star stocks such as Apple, Microsoft, and Nvidia, also hit a new high., the other 10 sector indexes are still 15% away from new highs on average.
In January 2022, when the last time it hit a new high, a total of 8 sectors of the S&P hit new highs at the same time.
Is the AI chip feast exclusive to "NVIDIA Moments"?
Coincidentally, next week is also the day when U.S. technology and chip giants such as Apple, Microsoft, Qualcomm, and AMD release their financial reports. In conjunction with the Federal Reserve's interest rate decision and non-farm payrolls report, this whole week can be said to be exciting!
More importantly, Intel plunged 11.9% after releasing its financial report this week, and its first-quarter revenue guidance was a full $2 billion different from expectations; Tesla plunged 13% in a week, knocking Musk off his position as the world's richest man, and investors suddenly discovered thatAfter sluggish demand for smartphones and PCs in 2023, there will be concerns about demand for automobiles and traditional industrial applications in 2024.
Judging from the schedule,Both AMD (after the bell on January 30) and Qualcomm (after the bell on January 31) will release earnings next week., one is Nvidia’s biggest rival, and the other is the leader in AI chips empowering mobile phones and computer equipment. In addition to the performance of these companies, the U.S. stock market is also waiting for a key answer: what kind of crowding out effect NVIDIA's "one dominant company" has on competing products.
For example, Zuckerberg, who is very familiar to investors, announced this month that Meta will have nearly 600,000 high-end graphics cards by the end of the year, most of which are Nvidia products. Many analysts also pointed out that Intel's poor financial guidance is also related to Nvidia. In the data centers where Microsoft, OpenAI, Meta and other companies are investing heavily, Nvidia's accelerator cards are the first choice.
Intel CEO Gelsinger tried to reassure investors this week, saying that subsequent Gaudi AI chips will show considerable revenue growth, but the stock price performance shows that investors are not buying it. Therefore, analysts will come to AMD's earnings conference call next week with many questions, such as what is the state of AMD's competition with Nvidia in the data center business.
Just as a few giants are betting heavily on the AI track, bringing huge benefits to Nvidia and "Huang Renxun's circle of friends" - TSMC, AMD and other companies,Some companies that manufacture chips for customers in traditional industries, such as Texas Instruments and STMicroelectronics, reported results that fell short of market expectations.
Texas Instruments' Q1 revenue guidance this week was about 10% lower than Wall Street's expectations. Dave Pahl, the company's director of investor relations, said the company expects to continue operating in a weak environment and customers will continue to balance inventories. Analysts in the chip industry also pointed out that the order cancellations reported by Texas Instruments have continued to rise in the past few quarters.
There was also news on Sunday that Japanese printer and camera giant Canon expects'Nanoimprint' device to ship this year or next. This "cheaper, more power-saving" chip manufacturing equipment means that products such as photolithography machines face route challenges. Of course, for ASML, which has just hit a new high, more impact will depend on the specific launch of the product.
Giants’ financial reports: Apple is the biggest concern
Microsoft with a market value of US$3 trillion (after the market on January 30), Apple with a market value of US$2.98 trillion (after the market on February 1), Alphabet/Google with a market value of US$1.92 trillion (after the market on January 30), Amazon with a market value of US$1.6 trillion (after the market on February 1), and Meta with a market value of US$1 trillion (after the market on February 1) will all release financial reports next week.
Judging from previous analyst expectations, Google, Microsoft, Meta under the AI concept, and Amazon, whose stock prices are 17% away from the historical high, are relatively safe. Apple, the former "stock king" of the U.S. stock market, is most likely to have problems.
For Apple, the first fiscal quarter report covering the year-end holiday season is also the highest revenue quarter of the year. The current market expectation is that Apple's Q1 revenue will be close to US$118 billion, and net profit per share will be approximately US$2.10. For horizontal comparison, Q1 revenue in fiscal year 2023 will be US$117.1 billion, and EPS will be US$1.88.
The last three months of last year were also the first full sales quarter after the launch of the iPhone 15 series and two new smart watches. The iMac and notebooks with M3 chips were also updated in time for the best sales time at the end of the year.
Like last fiscal quarter, the market is paying close attention to guidance from consumer electronics giants.Since the upgrades of each product line are relatively limited, the revenue of AI-related functions that have not yet appeared, as well as software services such as app stores are facing pressure from policies and regulations., the investment circle’s recent badmouthing of Apple has also begun to appear. Although Apple's ecological advantages will not disappear overnight, whether it can support a valuation of US$3 trillion is another question.