Since that mean reversion, we’ve seen another parabolic price move.
While it’s a stupendous result for those who accumulated the stock down near that $120 level, I’m miffed by the motivations of the buyers in today’s market with the stock in the $380 price region.
The law of large numbers also comes to mind as Nvidia approaches a market capitalisation of $800 billion.
Additional tension between China, the United States and the importance of Taiwan Semiconductor Manufacturing Company may signal the end, at least when it comes to the plunge in stock prices of affected or related semiconductor companies.
Today’s news is as close to a crescendo of threats as may be possible, without the next step being actual action.
This heightened angst may signal we are nearing the end of the tough talk but it’s a reminder that he deeper reason for many stoushes involving the United States are about trade and economics.
Will China actually take over TSMC?
This post I wrote in February 2022 put TSMC’s importance in perspective.
Since late February, shares in TSMC have fallen 50% and those options have risen 4-fold.
Was Pelosi’s visit to Taiwan worth it?
Since Nancy Pelosi arrival on Taiwan soil on August 2nd, 2022, the SOX Index has fallen 27%.
Good one Nance !
All of that in 2 months but I think hubby, Paul’s call option buying of Nvidia in the days prior to you announcing the trip to Taiwan haven’t worked out either (presuming he’s still holding them) as that stock has tanked 39% since your visit.
Is Biden’s decision on Friday October 7th, 2022 to ban semiconductor (and equipment) exports to China wise?
Since then (in 3 trading sessions) the shares in LAM Research, Applied Materials, Intel, AMD, Nvidia, KLA Corp, ASML and TSM have fallen 19%, 14%, 8%, 15%, 12%, 15%, 13% and 15% respectively.
Biden is still help bent on his pre-mid term election strategy of being tough on China and invoking massive domestic spending (the opposite to Obama, whom Biden blames for their mid-term mauling in 2014) but he causing higher inflation by ‘de-globalising’ relations which have traditionally assisted the United States and various nationalism and protectionist measures are adding to global tensions.
I don’t think Biden realises the job losses and investment losses he is about to cause with these export bans, let alone the investment losses being caused.
For some perspective, notwithstanding overvaluations and possible slowing product demand, since is price peak in November 2021, Nvidia has seen its shares fall 65% and its market capitalisation has declined by $554 billion.
That is the same amount of money if you wiped out the entire market capitalisation of Australia’s largest 4 banks, BHP, Rio Tinto, Wesfarmers and Woolworths or 50% of the total market capitalisation of companies listed on the Australian Stock Exchange (ASX).
Many are watching the great semiconductor shake-out.
The warnings of fervour and a peak where evident 15 months ago.
Speculators were playing in rarefied air when the SOX Index was flying between 3,400 and 4,000.
Today, it’s trading at 2,275.
Nvidia is one but not the only proxy for calling an end of the decline.
Seeing NVDA shares trade at $105-$108 may be a point to heighten my awareness to some form of exacerbation or trough in share prices of various semiconductor stocks.
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