JPMorgan: Weakness in semiconductor stocks should be seen as a buying opportunity; the upward cycle is not yet nearing its end.
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US pre-market news at a glance: Samsung's earnings report triggered a collective weakness in semiconductor stocks in pre-market trading; SpaceX officially debuts on the Nasdaq 100 today.
According to BlockBeats, the following are key market news items before the US stock market opened on July 7th: 1. Samsung released its Q2 earnings forecast, showing an operating profit increase of over 1800% year-on-year, with single-quarter profits exceeding the total of the previous three years. Simultaneously, the company's revenue also increased by 129% year-on-year, reaching 171 trillion won. Affected by the semiconductor sell-off triggered by the "sell-off" of Samsung's earnings, chip-related technology stocks generally weakened in pre-market trading. The three major US stock futures indices showed mixed results in pre-market trading: Dow Jones futures rose 0.41%, Nasdaq 100 futures fell 0.9%, and S&P 500 futures fell 0.09%. 2. SpaceX officially debuted on the Nasdaq 100 before the US stock market opened today, with Wall Street institutions collectively bullish. Most institutions believe that SpaceX is no longer just a traditional aerospace company, but a platform company with the potential for rocket launches, Starlink satellite internet, AI infrastructure, and future space computing. 3. DeepSeek is secretly developing its own inference chip. If successful, this would reduce reliance on external suppliers and give it more cost-effective hardware control. However, the project is still in its early stages and faces manufacturing and memory acquisition restrictions due to US export controls. 4. UBS recommends investors buy SK Hynix's upcoming American Depositary Receipts (ADRs) and sell its South Korean shares, as these new shares are expected to trade at higher prices. 5. JPMorgan strategists say the recent weakness in semiconductor stocks should be seen as a buying opportunity, as the chip upcycle is not yet over, and truly meaningful new supply may not appear until 2028. 6. US ADP employment change for the week ending June 20 was 21,000, compared to 30,750 in the previous week. 7. BlackRock will launch an ETF tracking the tech-heavy Nasdaq 100 index, aiming to meet investors' growing demand for participation in the AI-driven stock market rally and challenge Invesco's dominant position. 8. Amazon is returning to the US bond market to raise funds for its artificial intelligence infrastructure. The company will issue eight benchmark bonds with maturities ranging from 3 to 40 years, raising at least $25 billion in the dollar bond offering. 9. Global brokerages have begun coverage research on Elon Musk's SpaceX (SPCX.O), and a preliminary consensus has formed on Wall Street: buy the stock. At least six brokerages, including Morgan Stanley, Goldman Sachs, and UBS, have given it a buy rating, optimistic about its long-term growth prospects, although doubts remain about profitability and valuation.
Multiple Wall Street firms are collectively advocating for "buying on dips" in the semiconductor sector: the long-term logic of AI remains unchanged, but investment is entering an era of selective buying.
According to Mars Finance, on July 7th, amidst the recent continuous correction in the semiconductor sector, several Wall Street institutions have voiced their opinions, generally believing that the current adjustment presents an opportunity for investors to "buy on dips." However, unlike past recommendations to allocate across the entire semiconductor sector, institutions generally believe that AI investment has entered a phase of selective stock picking. Goldman Sachs stated that AI chip trading has entered a more selective phase, and does not recommend continuing to "buy a basket" of semiconductor stocks. They remain optimistic about specific sub-sectors such as CPUs, ASICs, memory, and semiconductor equipment, specifically highlighting AMD and Applied Materials. JPMorgan Chase believes that the recent correction in semiconductor stocks presents a good entry window, as AI chip demand remains in a long-term upward cycle, with new capacity not expected to be significantly released until around 2028, and the industry's supply and demand structure remains healthy. Bank of America maintains its optimistic outlook on the long-term boom cycle of AI semiconductors, believing the industry is still in the middle of an 8- to 10-year growth cycle, and the global semiconductor market size is expected to continue to expand. They recommend focusing on industry leaders such as Nvidia, Broadcom, Lam Research, and KLA. UBS stated that the long-term investment logic for AI remains unchanged, and the short-term fluctuations in the semiconductor sector actually provide long-term investors with opportunities to gradually build positions. They recommend taking advantage of market corrections to buy on dips. Morgan Stanley believes that the long-term prospects for AI chips remain positive, but with the sector's significant rise, the market will focus more on earnings realization capabilities. Funds may gradually rotate from some chip stocks to AI infrastructure beneficiaries such as cloud computing, and investors should pay more attention to individual stock selection. Overall, several Wall Street institutions, including Goldman Sachs, JPMorgan Chase, Bank of America, and UBS, have recently released similar signals: the semiconductor correction is not the end of the AI rally, but rather provides a new window for investment. However, the market has moved from a phase of "broad-based sector gains" to one of "selecting leading companies," and future performance will depend more on companies' earnings realization capabilities and the sustainability of demand for AI infrastructure.
JPMorgan Chase: Semiconductor stocks' continued outperformance of cloud service providers may be unsustainable; AI trading may see sector rotation.
According to a report titled "Fund Flows and Liquidity: The Need for AI Rotation" released by JPMorgan Chase on July 3rd, semiconductor stocks—specifically, AI chip and memory manufacturers—have consistently and almost steadily outperformed hyperscale cloud service providers since September of last year. This performance gap appears unsustainable in the long term. The report argues that since semiconductor trading is inherently part of a broader AI market, the current divergence is raising concerns about its sustainability. JPMorgan Chase states that this gap could narrow in two ways. In a positive scenario, as hyperscale cloud providers, AI model providers, and users improve in commercialization, revenue, and profitability, their performance will begin to catch up, gaining a larger share of overall AI value-added. In a negative scenario, if the semiconductor outperformance comes at the expense of customers such as hyperscale cloud providers, AI model providers, or end users, it could dampen their willingness to invest in capital expenditures, ultimately hindering demand for semiconductor companies' products. The report notes that while JPMorgan Chase's internal view leans towards a more positive scenario, analysts' consensus forecast indicates a significant slowdown in hyperscale cloud service provider capital expenditure growth starting next year, which, if true, is closer to a negative scenario. The report states that hyperscale cloud service provider capital expenditure growth is projected to reach 100% in 2026, but may drop to 22% in 2027 and further to 7% in 2028. If this slowdown path holds true, semiconductor transactions could face significant pressure, triggering a more significant and sustained correction in AI transactions across the stock and bond markets. JPMorgan Chase also states that the price of AI computing power will be crucial for hyperscale cloud service providers to commercialize their AI capital expenditures. Higher computing power prices will enable cloud service providers to maintain or increase profit margins. Furthermore, the report states that the rate of money creation in the United States is projected to rise from $1.6 trillion in 2025 to $1.8 trillion in 2026, continuing to support US financial assets, particularly US stocks.
JPMorgan Chase and HSBC: Market pullbacks provide a window for investment, not a trend reversal.
According to BlockBeats, on July 6th, as we enter the second half of the year, several Wall Street institutions believe that the recent market correction is more of a repositioning opportunity than a trend reversal. Both JPMorgan Chase and HSBC Holdings believe that short-term volatility in global stock markets will not change the overall upward outlook, but the two institutions differ in their specific allocation strategies. Mislav Matejka, Head of Global and European Equity Strategy at JPMorgan Chase, and his team stated that they have maintained a "buy on dips" view since the outbreak of the Iranian conflict. The bank believes that the global economy remains resilient, the situation in the Middle East has not significantly damaged economic growth, and central banks have not shifted to more aggressive tightening policies. Strategists expect that global and emerging market stock markets are likely to reach new highs in the future, and believe that the attractiveness of international markets is increasing. They also believe that the South Korean market, after its recent correction, is worth buying on dips. In terms of sectors, JPMorgan Chase believes that the Philadelphia Semiconductor Index has presented another buying opportunity after the recent correction, but remains relatively cautious about large-cap US technology stocks. The bank advises caution regarding AI-driven sectors, including software, business services, and media. Conversely, the basic resources sector has regained its investment value after recent adjustments, and gold is becoming more attractive. Strategists also point out that overall investor positioning remains cautious, with the market holding substantial cash reserves. If a summer correction occurs, funds are expected to flow back into the stock market. Max Kettner, Head of Multi-Asset Strategy at HSBC Holdings, is more focused on the recovery opportunities in leading AI companies. He stated that the market is entering its summer rally in July and August, and AI hyperscale cloud service providers have already experienced a cumulative correction of approximately 20%, which is considered excessive. Kettner believes that current market expectations for these companies' earnings have been significantly lowered, and these companies still maintain strong profitability. If they can prove that their massive AI capital expenditures are gradually translating into revenue, it will further drive valuation recovery.
Semiconductor equipment stocks rebounded after a period of volatility, with Lianlian Technology and Huafeng Measurement & Control both rising by more than 10%.
Mars Finance reported on July 8th that semiconductor equipment stocks rebounded after a period of fluctuation, with Liandong Technology and Huafeng Measurement & Control both rising by over 10%, followed by Zhongke Feice, Shengmei Shanghai, and Fuchuang Precision. In related news, Liandong Technology released its 2026 semi-annual performance forecast, projecting net profit attributable to shareholders of the parent company to be between 21 million and 29 million yuan, representing a year-on-year increase of 73.39% to 139.44%; and projecting net profit excluding non-recurring items to be between 16.1 million and 24.1 million yuan, representing a year-on-year increase of 121.55% to 231.64%. (Science and Technology Treasure Broadcast)
U.S. stocks closed lower across the board, with semiconductor, memory, and optical communication sectors leading the declines. The Philadelphia Semiconductor Index fell 4.65%.
According to BlockBeats, on July 8th, based on BIT (bit.com) market data, the US reinstated military strikes against Iran and oil sanctions. As a result, all three major US stock indices closed lower: the Dow Jones Industrial Average fell 0.25%, the Nasdaq Composite fell 1.16%, and the S&P 500 fell 0.45%. The semiconductor and memory sectors declined, with the Philadelphia Semiconductor Index falling 4.65%, and SpaceX falling nearly 7%, hitting a new low since its IPO. The memory sector saw the largest declines, with Western Digital (WDC) down 7.86%, Seagate Technology (STX) down 4.68%, Micron Technology (MU) down 4.71%, and SanDisk (SNDK) down 7.26%. Semiconductor stocks generally declined, with Lam Research (LRCX) down 6.87%, Applied Materials (AMAT) down 6.46%, Marvell Technology (MRVL) down 7.45%, KLA-Tec (KLAC) down 7.22%, AMD (AMD) down 6.51%, and Intel (INTC) down 9.66%. Optical communication concept stocks also faced pre-market pressure, with Astera Labs (ALAB) down 11.12%, Ciena (CIEN) down 3.44%, Coherent (COHR) down 6.43%, Lumentum (LITE) down 4.42%, and Corning (GLW) down 4.84%.