CICC: AI Pullback Highly Similar to Four Corrections in 2000; Stabilization in This Round Requires Easing of Three Major Pressures

TechFlow news, August 2, according to CICC Research, starting from mid-to-late June, the global AI chain has seen a significant pullback, particularly severe in South Korea, characterized by "high leverage, high crowding, and high retail participation." Behind this lies the amplifying effect of high crowding and high leverage, disturbances from macroeconomic factors (such as rising expectations of Fed rate hikes, the renewed blockade of the Strait of Hormuz pushing up oil prices, etc.), as well as renewed bubble concerns from the market regarding AI reaching this stage (such as Meta renting out computing power, decreased Token spending, etc.).

In fact, before the bubble finally burst in March 2000, the dot-com rally also experienced at least four large-scale and long-lasting corrections. The triggers for the decline were highly similar to this round of adjustment: short-term setbacks in industry trends; "headwinds" in the macroeconomic environment; overheated valuation sentiment. And ultimately, tech stocks were able to rebound again also due to the relief of pressure from these three aspects. Therefore, corresponding to the present, for the market to stabilize or even restart a new round of gains, it also requires the coordination of these three factors, namely the digestion of high crowding and high leverage (largely achieved), the alleviation of Fed rate hike expectations or the uncertainty being resolved (watch the July FOMC), and more importantly, new catalysts from earnings and industry aspects (July-August earnings season). (Jin10)