Prior to the release of earnings reports by global artificial intelligence (AI) leader Nvidia, the stock prices of two key semiconductor companies, TSMC and ASMC, experienced a decline.
NVIDIA is scheduled to announce its fourth quarter results after the close of each share on Wednesday (February 21), followed by a crucial speech from NVIDIA CEO Huang Renxun. Wall Street will analyze and determine how long the company's massive revenue growth can continue.
However, before the release of this heavyweight financial report, global funds had been fluctuating. On Tuesday, Nvidia's stock price plummeted by 4.35%, marking the largest single day decline of the year and leading the decline in US technology stocks.
Subsequently, on Wednesday morning, TSMC in Nvidia's "Moments" also experienced a decline, with its stock price dropping more than 1% in the Taiwan stock market. TSMC is the world's largest top chip manufacturer, with major customers including large technology companies such as Nvidia and Apple.
The share prices of other large semiconductor companies in Taiwan, China also declined on Wednesday. As of the closing, Lianhua Electronics and MediaTek fell 1.52% and 0.10% respectively on Wednesday.
In addition, the stock price of Dutch lithography giant ASML fell 2.09% on NASDAQ on Tuesday.
Asma supplies critical machines for chip manufacturing to companies such as TSMC, including the Ultra Ultraviolet (EUV) lithography machine used to manufacture the world's most advanced chips, which is currently used in Apple's iPhone chips. At present, the production of high-end process chips still relies on the support of Asma lithography machines.
Matt Weller, head of the global research team at Jiasheng Group, explains that some traders may want to profit before major financial reports are released, which is not surprising.
Hold your breath for Nvidia's financial report to appear
Thanks to the prosperity of artificial intelligence, the demand for Nvidia Graphics Processing Units (GPUs) in the market continues to soar, and Nvidia's stock price has more than doubled last year.
At present, the market's focus is on whether Nvidia can continue to deliver strong performance and far exceeding expected performance guidelines. This financial report is highly likely to affect the overall direction of the US stock market.
Morgan Stanley stated in a report on Tuesday that Nvidia "should see a strong quarterly performance that aligns with recent expectations," and pointed out that Nvidia's "focus should shift to new products.".
The report states, "Since the beginning of this year, Nvidia's stock price has risen by more than 50%. We do not believe that a positive performance report from Nvidia will immediately trigger a strong market reaction, and we also do not believe that the company's stock will experience a significant sell-off."
At the same time, Weiler, the head of the global research team at Jiasheng Group, said that if the financial report does not fully meet the high level expected by traders, or if the financial report and revenue are only slightly better than expected, and the stock price has not shown a meaningful rebound, then the current sell-off may also be an ominous signal.