U.S. stocks close lower with Apple, Tesla and options after gains on TSMC

01/17 U.S. stocks close lower with Apple, Tesla and options after gains on TSMC

The U.S. stock market started higher reflecting expectations for the earnings season. In particular, semiconductor stocks led the rise due to TSMC’s earnings announcement (+3.86%). Meanwhile, the weak dollar and interest rates, which had been strong after the announcement of economic indicators such as retail sales, also rose. However, sales shifted to a lower position with some stocks such as large tech stocks, and the market closed with a sharp drop due to the option expiration date (Dow -0.16%, Nasdaq -0.89%, S&P 500 -0.21%, Russell 2000 +0.15%, Philadelphia Semiconductor Index +0.18%)

*Factors to Change: Economic Indicators and Interest Rates, including Retail Sales

U.S. retail sales slowed to 0.4% in December from a 0.8% month-on-month increase, but figures excluding automobiles improved from 0.2% to 0.4%, either in line with market expectations or slightly sluggish. In detail, healthcare shifted from 0.3% to 0.2% while automobiles and parts slowed to 0.7% month-on-month. Online sales also slowed to 0.2% from 1.7%. On the other hand, department stores shifted from 0.4% to 0.1% and retail general stores also shifted from 3.9% to 4.3% increase. Food and beverage stores also shifted from 0.2% to a 0.8% increase.

In the end, U.S. consumption is characterized by an increase in sales at offline stores, where large-scale discounts related to the year-end shopping season were held. This is also attributed to retail sales, which drove the job market in the recently released employment report, with retail employment shifting from 2.92 million to 4.34 million. In addition, in the consumer price index, home appliances fell a whopping 4.1% month-on-month, the highest-ever drop, and the impact of massive discounts in the year-end shopping season was introduced. These economic indicators show that the U.S. economy seems to be solid, but reasonable consumption growth, job insecurity, and inflation are underway

Although the announcement of retail sales led to a rise in the dollar and interest rates, it turned weak due to the inflow of reversals. In particular, the decline in the dollar and interest rates widened further when Fed Director Christopher Waller noted in December that price indicators are very positive and that there is no need to rule out the possibility of a rate cut in March if this trend proceeds, and claimed that three to four rate cuts are possible this year depending on the data. As a result, the stock market remained solid despite the sluggishness of some of the large tech stocks.

On the other hand, it is noteworthy that pessimism is growing in the individual investor sentiment index, with the outlook for a rise in the stock market after six months falling to 25.4 percent, far below the historical average of 37.5 percent, and the outlook for a decline to 40.6 percent, exceeding 31.0 percent. The related aspect is a factor that increases the volatility of individual stocks, which are highly interested in individual stocks, which are currently leading the supply and demand of the market. The market is expected to expand the volatility of individual stocks for the time being due to Trump’s inauguration and full-fledged earnings season.

*Featured stocks: TSMC up Vs. Nvidia down, China’s EV up Vs. Tesla down

With TSMC (+3.86%) expecting a 38.8% increase in sales in the fourth quarter after its December sales announcement last week, the results were announced at $26.9 billion. The operating profit ratio increased from 41.6 percent to 49.0 percent. In addition, the company forecast a continuous slowdown by forecasting its first-quarter sales of 250-25.8 billion dollars, but its stock price soared after exceeding market expectations ($23.9 billion). Meanwhile, TSMC presented facility investment (38 billion to 42 billion dollars) in 2025, significantly exceeding market expectations of $35.1 billion. As a result, semiconductor equipment industries such as ASML (+3.30%), AMAT (+4.54%), RAM Research (+4.03%) and KLA (+4.33 percent) surged. Marvell Tech (+1.36%) and Broadcom (+0.62%) also rose

On the other hand, Nvidia (-1.96%) started higher amid expectations for the AI industry after TSMC’s earnings report, but it turned downward due to the continuous slowdown in TSMC’s sales. In addition, it is also burdensome to hear that the Chinese government has opened an investigation into the U.S. chip law, or semiconductor subsidies and dumping allegations. Although the Chinese government did not announce a company, Texas Instruments (-5.13%) fell, which was largely affected by the related announcement, while Micron (-0.57%) was also sluggish amid clear declines in Qualcomm (-1.81%), Analog Device (-1.47%), and AMD (-1.27%). Nevertheless, the Philadelphia Semiconductor Index rose 0.18% on soaring equipment and parts industries

Tesla (-3.36%) fell on news of a cut in the price of its Cybertruck in stock amid an influx of a return from a sharp rise in the previous day. This suggests that demand for related vehicles has slowed significantly. Meanwhile, Rivian (+3.59%) and Lucid (+1.32%) are expected to see interest rates fall. Chinese electric cars such as Nio (+1.46%), Xpeng (+6.28%), and Li Auto (+0.91%) are strong on news of using their own chips. On the other hand, as lithium carbonate prices fell on the Chinese exchange, Albemarle (-0.87%) and QuantumScape (-0.94%) were sluggish. Uber (+2.33%) continued to rise after Goldman Sachs maintained its target price of $96 the previous day, reflecting expectations for growth.

Apple (-4.04 percent) fell to third place amid sluggish iPhone sales in China. Meta Platforms (-0.94 percent) and Snap (-5.24 percent) fell on news that Trump will consider an executive order to postpone the ban on TikTok from 60 to 91 days amid controversy over the issue. Snap saw its fall further on news that the FTC sent it to the Justice Department. Alphabet (-1.30 percent) is also sluggish. The EU announced its opposition to Trump’s plan to ease regulations on tech companies. Microsoft (-0.41 percent) fell just before the market closed despite news of a hike in prices of Microsoft’s 365 consumer version following news of its corporate AI chat, a $30 subscription fee. Amazon (-1.20 percent) turned downward on news of slowing online sales among retail sales indicators

Palantir (+1.61%) rose as the software industry clearly progressed in stabilizing interest rates. In addition, the expansion of call options also contributed to supply and demand