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The subject of today’s report is “SMIC falls, who is really full?”.
Why has the stock market and commodity market fallen since September? The Dow Jones index fell 2,000 points from the highest point, the Nasdaq fell 1,200 points, the Shanghai Composite Index fell 200 points, and Taiwan stocks also fell 600 points. The prices of oil, copper, silver and rebar are falling. Is this the second wave of epidemics in Europe and America? Or is it a variable in the American elections? This is part of the reason, the most important reason is the “rise in the dollar”, which is the main culprit.
Wanbao Investment Gu Cai Mingzhang stressed that although global government bond interest rates are declining, market liquidity is declining and the central bank’s monetary easing has not changed. However, liquidity easing and marginal utility are declining, causing the speed of global currency issuance to slow. The expansion of the Fed’s balance sheet money printing due to the epidemic has recently started to slow down.
On June 10, after the Fed’s total assets hit a record $ 7.2 trillion, they fell for four consecutive weeks. Although they rose to August 26, they contracted another $ 20 billion. This time it was a passive reduction.
The epidemic erupted into a liquidity crisis. The Fed began to buy back bonds and reached a currency swap with other central banks, on a scale of US $ 400 billion. Since then, the liquidity crisis has gradually disappeared. The size of central bank currency swaps has been reduced to US $ 90 billion. In the period, the active purchase of assets by the Fed continues.
The liquidity crisis erupted from March to April. The Fed’s purchase of Treasuries once reached US $ 75 billion a day, but the pace of asset purchases has slowed. Going forward, the market will react to the US government’s next economic stimulus plan A political battle for the US $ 2.4 trillion stimulus package. If approved, the Fed’s asset purchases will expand, the US dollar will fall, and the global stock market and commodity markets will rise. If delayed until after the general election vote, the Fed’s asset purchases will slow, reducing the balance sheet, which will be detrimental to the global stock market and commodity markets.
The Dow Jones Index rose 60% from its March low to its high, and the Nasdaq rose 91.5%. Taiwan shares rose 52.8% from a low of 8,523 points to a high of 13,031 points. A long rise is the biggest bearish.
Wanbao Investment Gu Cai Mingzhang stressed that it is necessary to be careful of sudden medium-term corrections. October is the eighth month since the end of March. It is a turning point in Febonanchi’s time. This is a test of human nature and the limit of bull market patience. It’s 8 months, so the probability of changing markets in October is increasing.
The Taiwanese stock market is up 4,500 points. If 1/3 is revised in the medium term, the support of the annual line of 11,500 points will be checked again. At this time, the operation is more important than the analysis. It is necessary to strictly observe discipline and reduce the participation rate below 50%. The policy cap is a key factor in the ceiling of the US stock market.The Fed’s quantitative easing is slowing, with $ 3.8 trillion in the second quarter, $ 2.4 trillion in the third quarter and only US $ 1.1 trillion in the fourth quarter. The stock market will react early. .
Entering the third quarter of September, the Dow Jones peaked at 29,199 points and the Nasdaq hit a sky-high price of 12,074 points. Although Taiwan shares returned to Wansan for the second time, the volume and price diverged. The volume on September 16 was just 210 billion yuan, much lower than the 350 billion yuan that first hit Wansan on July 28, so the US dollar rallied and the US dollar index. It went from a September low of 91.75 to 94.5 now, causing the global stock market to pull back.
Right now, let’s take a look. The number of confirmed epidemics in Europe and the United States continues to rise, but the death toll is at a low level. Therefore, it will not be like the panic of the first wave of epidemics from March to April. US stocks will not plummet or break. This midterm review, It may be a recession, but the Dow Jones index is only 700 points from the yearly line and the margin is only 3%. He is still on the brink of danger. Before the October general election, if it falls below the annual line, it will trigger global stock markets, including Taiwan stocks. Correct down.
In October, we expect a result of the third phase of the vaccine experiment, but the success of the vaccine development may not be a big gain on the stock market. The Fed will reduce its balance sheet to reduce funding. At this time, the stocks of the item will be reduced in operation. Quantity changes hands and the future lacks the ability to track price.
The solar energy group announced its third quarter financial report in mid-November. Even if it goes from a loss to a profit, the share price has been fully reflected and needs to be closed. Most biotech stocks lack a third quarter financial report, but the stock price has risen sharply. It fully reflects the fundamentals.
In addition, the most important news is that SMIC has been sanctioned by the United States. Taiwan Semiconductor won the transfer order. SMIC’s 40nm or higher process accounted for 90% of its revenue, making it beneficial for the 8-inch UMC (2303-TW) foundry. ), World Advanced (5347-TW) will have an excuse to raise prices.
In addition, SMIC is also an OEM for Zhaoyi Innovation, the world’s third largest NOR Flash factory, so the market is thinking of transferring orders to Winbond (2344-TW) and Macronix (2337-TW). The fall in the share price is limited, so it appears to be variable if such a transfer order effect can be reflected in the increase in the prices of NOR Flash. However, on Monday, including UMC, Winbond and Macronix have turned on their daily limit, and the revenue comes from ASIC (special application chip) shares in the Chinese market, such as Worldchip-KY (3661-TW), Andes ( 6533-TW), Jinlike (3228-TW), but there was a blackout on Monday.
But understand why the supply of 8-inch wafers is in short supply, not from smartphones but from laptops, especially in the long-distance business opportunities caused by the severe epidemic. The notebook group’s third-quarter earnings report was excellent, with e-sports gaming-related stocks ranked second.Beneficiaries of epidemic demand are the medium-term pullback of Taiwan stocks in October , and they can undertake the descent in batches in the falls.
E-sports shares Gigabyte (2376-TW), MSI (2377-TW), Thermaltake (3540-TW), estimate Q3 single season EPS to be 2.4 yuan, 3.5 yuan and 3 yuan. With the hot sales of graphics cards and game consoles, Q4 performance visibility is still very high. Acer (2353-TW) and ASUS (2357-TW) Dual-A laptops have a significant increase in EPS in the third quarter compared to the prior quarter. Acer estimates that 0.5 ~ 0.6 yuan, a new high in the last 10 years, is stronger than other electronic stocks and remains close to the monthly line.
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