US Market Summary
The stock market is not holding up well.
All 3 major indexes have broken below their 50-day moving averages. (see below)
US 3 Composite Indexes - Past One Month performance
On Wed (17 Apr) when market closed:
DJIA: -0.12% (-45.66 to 37,753.31). At its worst level since late January 2024.
S&P 500: -0.58% (-29.20 to 5,022.21). At its worst level in 2 months.
Nasdaq: -1.15% (-181.88 to 15,683.37). Fell below the 16k level, its worst in 2 months.
What Happened to Semiconductors?
Chip stocks were big losers Wed, 17 Apr 2024.
$ASML Holding NV(ASML)$ has become the poster scapegoat as a result of its disappointing earnings and guidance.
ASML Q1 2024.
Company missed its sales forecast, although it insists its on-target for its FY2024 outlook.
Net sales.
Came in at EUR 5.29 billion (US$5.62 billion) vs expected EUR 5.39 billion.
Net sales fell -21.6% YoY.
Net profit.
Came in at EUR 1.22 billion vs expected EUR 1.07 billion.
Net income dropped -37.4% YoY.
Net bookings (for ASML machinery).
Fell by -4% YoY, totalling EUR 3.6 billion for Q1 2024.
Compared to Q4 2023, it has fallen by -66.67%, a huge slump.
Owing to the business’s cyclical nature, market has factored “the dip” in their estimates, after a stellar Q4 2023 earnings.
This explained why market was disappointed (& fell) after ASML’s results were announced.
Stock Price Movement.
On Wednesday, ASML tumbled -7.1% to close at $907.61 per share.
It is gapping below its 50-day line and the lows of its flat base.
YTD, it bottomed on 04 Jan 2024 at $700.29 per share.
YTD, it peaked on 07 Mar 2024 per share at $1,047.39 per share, before March 2024 CPI report spooked the market 3 days later.
In contrast, $Taiwan Semiconductor Manufacturing(TSM)$, handed in a stellar report card for its Q1 2024 earnings.
TSM Q1 2024.
Net revenue:
Came in at NT$592.64 billion (US$18.87 billion), vs. NT$582.94 billion expected.
Revenue rose by +16.5% YoY.
Net income:
Came in at NT$225.49 billion (US$7.18) vs. NT$213.59 billion expected.
Income rose by +8.9% YoY.
Q2 2024 Outlook.
TSMC expects Q2 Revenue to be between US$19.6 billion & US$20.4 billion.
This will be a growth range of +3.87% and +8.11% gain QoQ.
Stock Price Movement.
On Wed, 17 Apr 2024 - TSM stock price slipped a little -0.55% to $139.03 per share.
It is facing some selling pressure after rising earlier in the week.
Analysts think TSM could be forming a new trading pattern with a potential buy price of $158.40.
Some might even buy sooner; at a price it reached earlier this month ($148.43).
Like it or not, TSM's results & guidance will be key for AI chip leaders $NVIDIA Corp(NVDA)$, $Broadcom(AVGO)$ and $ARM Holdings Ltd(ARM)$.
With a stronger than expected Quarterly earnings, will TSM be able to pull the Semiconductor stocks higher - just as ASML had dragged the Semiconductor stocks down ?
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