Nvidia has ended its day in the world. The fall in yesterday’s market was mainly attributable to overstretched valuation and the disappearance of a possible U.S. rate cut in December. Nvidia rose more than 5% after-hours yesterday and fell almost 3% in the U.S. market, which means that people who buy from the top will lose 8% but will have to rise more than 10% from the current price in order to recover their principal. It will be a big blow. There are many reports that have doubts about Blackwell chips. Off the chart, or “too expensive,” means that the margin should exceed 70% in order to meet the expected operating profit, but analysts are raising doubts about that.
The second reason for the decline was that the September employment index, released yesterday, unexpectedly showed non-farm payments of 119,000 (estimated 50,000), signaling that employment is still good. So is it necessary to cut rates in December? And the market fell on the notion that these numbers did not provide hawks within the FED with a solid basis for the rate cut. In the aftermath of the shutdown, the September employment index came out yesterday, but the public opinion is that the October employment index will probably be skipped. If so, the basis for the interest rate judgment at the FOMC next month is the September employment data released yesterday.
Psychology is important for investment because human beings do it. Depression and anxiety have hung over the U.S. market. The market hates it. Fear…. If interest rates don’t fall, it will affect AI investment, so the formula is that interest rates cannot be cut = AI investment cannot be expanded. The most fundamental problem is that the soaring asset prices will now collapse the K-shaped growth, which has been sustained by only high-income consumers, and the economy will only fall or adjust. As soon as Leo Dalio said in early U.S. markets yesterday, “The market is a bubble right now, but this is not a reason to sell stocks,” he said awkwardly as Nvidia fell out. By the way, it’s a bubble. Don’t sell stocks? He said, “There’s no need to sell stocks considering the earnings correlation in the next 10 years. But if the decline continues, who will compensate for the difficult times when the AI industry’s earnings correlation is good?
It’s still unknown time, so the lights on the Christmas tree in front of me are shining. Walmart did a great job yesterday. In front of famous American department stores Saks Fifth Avenue, Neiman Marcus, Boomingdale’s, Nordstrom, Macy’s, JCPenney and Kohl’s, it’s time for Christmas decorations to unfold. And Christmas carols… There’s a carol that I like every year. Last year it was Let it snow, and before that, Mary’s Boy Child,
It was The Twelve Days of Christmas, and this year I’m listening to “Carol of the Bells” written by Mykola Leontovich, a Ukrainian composer. It sounds like a cheerful mass from the cathedral, and the more I listen to it, the better it is. It’s a carol of the year. Of course, my favorite is “Silent Night,” but…
In the stock market, the funds Book Closing will continue anyway. I’m also planning to book closing in early December. Keep your investment well in a volatile market and have a good weekend because it’s Friday. Catch you later.