US Stock Trend (July 16): Apple Hits All-Time High, Memory Stocks Lose 9% Overnight
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US Stock Trend (July 16): Apple Hits All-Time High, Memory Stocks Lose 9% Overnight
TSMC's earnings report is about to be released, which will be the next specific milestone to validate the main theme of memory and chips.
Navigating Web3 tides with focused insightsWritten by: TechFlow Research
News broke that Apple's AI cooperation with Alibaba has completed regulatory filing in China; stock price rose 4.01% that day to hit a historic high, while Alibaba rose 4.8% in sync. June PPI fell 0.3% month-on-month, marking the largest drop in six years. It was the second day this week that inflation data came in below expectations. Coupled with Morgan Stanley and BlackRock earnings both exceeding expectations, the three major indices closed slightly higher. However, the storage chip sector became the biggest loser of the day: SanDisk fell 8.12%, SK Hynix fell 9%, Western Digital fell over 8.7%, Micron fell 8%. The market showed significant divergence in pricing the storage supercycle.
Market Performance
The S&P 500 rose 0.38% to 7572.40 points. The Dow Jones rose 0.29% to 52658.64 points. The Nasdaq rose 0.62% to 26269.23 points.
Apple led the Dow Jones, rising 4.01% to hit a historic high. Google rose 3.17%, Meta rose 3.07%, Amazon rose 3.02%, Microsoft rose 2.78%. NVIDIA fell nearly 3% intraday before closing up 0.33%. Tesla was the only decliner among the Magnificent Seven, falling 0.43%. Morgan Stanley's stock price hit a new high, and BlackRock rose 6.6%.
Storage chip stocks plummeted collectively: SanDisk fell 8.12%, SK Hynix US ADR fell 9%, Western Digital fell over 8.7%, Micron fell 8%, Seagate fell 5.7%, and the Semiconductor ETF fell 1.59%.
The Communication Services sector gained the most, up 2.78%. The Utilities sector led declines, falling nearly 1%. The Energy sector fell 0.77%, and the Real Estate sector rose slightly by 0.09%. The Banking and Regional Bank ETFs gained up to 1.18%, the Global Airline ETF rose 1.30%, the Technology Industry ETF fell 1.08%, and the Global Tech Stock Index ETF fell 0.82%.
Alibaba rose 4.8%. PayPal surged 17.2% on acquisition rumors, and Aehr Test Systems rose 22%. SpaceX fell for the fourth consecutive trading day, dropping to $133 intraday, breaking below the issue price of $135.
WTI crude oil rose 0.33% to $79.60/barrel. Brent crude oil rose 0.26% to $84.95/barrel; crude oil has risen for three consecutive days to hit a one-month high. COMEX gold fell 0.42% to $4044/ounce. COMEX silver fell 2.83% to $57.11/ounce. Bitcoin rose above $65,000 intraday, up nearly 2% from the daily low.
The 10-year US Treasury yield was 4.55%, down about 4 basis points intraday. The 2-year US Treasury yield was 4.13%, down about 6 basis points intraday, plunging about 10 basis points from the intraday high. The US Dollar Index turned negative, hitting a nearly four-week low.
Macro and Outlook
June PPI fell 0.3% month-on-month, marking the largest single-month drop in six years. The year-on-year increase of 5.5% was lower than the expected 6.2%. Core PPI rose 0.2% month-on-month, and the year-on-year increase of 4.7% was also lower than the expected 5.1%. This is the second consecutive day of softer inflation data published following CPI. The probability expectation for the Fed to raise interest rates by 25 basis points this month has dropped to 10.2%; a week ago, this figure was 31.0%.
Waller maintained a cautious stance on the second day of congressional hearings, acknowledging that CPI and PPI data have improved, but emphasized that a single inflation indicator cannot perfectly reflect the true situation. The logic of AI pushing up chip prices and external conflicts pushing up energy prices is essentially different. He also stated that Trump never asked him to make any improper decisions, and Trump also reiterated his hope for rate cuts on that day.
New York Fed President Williams believes the policy stance is already in a favorable position, and inflation is likely peaking; Fed Governor Cook is relatively more hawkish, stating that if inflation does not continue to fall, she is ready to take action.
Morgan Stanley's revenue and earnings this season both refreshed historical records, with the core driver coming from the equity trading desk, where revenue surged nearly 70% compared to the same period last year. This report card is consistent with the logic of Goldman Sachs and JPMorgan previously; the severe market volatility in the second quarter actually achieved a historical performance for the trading business.
The plummet in the storage chip sector forms a sharp contrast with the surge in previous days. Two days ago, SK Hynix US ADR surged 27% in a single day; now it has fallen back 9%. Confidence in the storage supercycle seems to be shaking.
Some views suggest that cloud service providers and chip manufacturers are discussing using financial derivatives to hedge against the risk of falling storage prices, which forms a subtle opposition to the optimistic sentiment conveyed by ASML's earnings report. ASML's second-quarter performance fully exceeded expectations and full-year guidance was raised. Management believes the memory "peak theory" was powerfully refuted, but the storage stocks' performance that day seemed not to buy into it.
The completion of regulatory filing eliminated previous market concerns about whether the China-version AI features could be implemented. Alibaba's technical capabilities have been verified by top-tier clients like Apple, and the "Apple Supply Chain + AI" narrative is becoming one of the new pricing logics for tech giants. This signal is equally important for other Apple supply chain suppliers and domestic AI application companies. Apple's filing approval has been successfully navigated, meaning that for subsequent mobile on-device AI features from Doubao, Baidu, and others approved in the same batch, the regulatory uncertainty regarding the commercialization path is also removed simultaneously. The variable of "approval bottleneck" that the market previously worried about is being removed from the pricing model.
SpaceX fell for four consecutive trading days and broke below the issue price for the first time, reflecting that market doubts about AI infrastructure costs and returns are spreading from chip stocks to a broader range of AI infrastructure concept stocks.
TechFlow Perspective
The market trend that day revealed an interesting divergence. Cooling inflation data should have been a reason for a general rise, but capital was clearly making choices. Targets with specific performance verification like Apple and Alibaba were sought after, while sectors like storage chips, which previously rose driven by expectations, encountered profit-taking.
The market is switching from the "storytelling" phase to the "want evidence" phase. Whoever can produce real performance support can traverse the noise of inflation and rate hike expectations.
The consecutive days of surges and plunges in storage chip stocks indicate that, as part of the AI narrative, pricing on the hardware end is far more fragile than on the financial service end. The statements from Waller and Cook reveal subtle divergences; consensus within the Fed on the timing of rate cuts has not truly formed. TSMC's earnings report is about to be released, which will be the next specific node to verify the storage and chip main line. If TSMC's AI-related revenue guidance remains strong, the current pessimistic pricing of storage stocks will likely be falsified; if the guidance shows even slightly conservative wording, the market may determine that this plunge was a reaction in advance, not an overreaction.
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