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tencent news "periscope"

author | ji zhenyu

editor | liu peng

on september 3rd, us time, chip giantnvidiathe stock price suffered a sharp drop, falling nearly 10% throughout the day, and the market value evaporated by us$279 billion (about rmb 1.99 trillion) overnight, setting a record for the single-day loss of market value of a listed company in history. after the market closed, there was news that nvidia received a subpoena from the us department of justice regarding an antitrust investigation, which further aroused market concerns about the company, causing nvidia's stock price to continue to fall after the market closed that day.

in addition to nvidia, the overall u.s. stock market also fell sharply. as of the close, the s&p 500 fell 2.12%, the nasdaq composite fell 3.26%, and the dow jones industrial average fell 1.51%. this market trend set the largest single-day drop since the big drop in early august.

nvidia,google、applethe heavyweight stocks represented by technology giants such as , became the hardest hit area of ​​the day. as they account for a large proportion of the us market value, the decline in the share prices of these giants also dragged down the overall market.

in terms of triggering reasons, the market decline on september 3 was similar to that a month ago, both of which were affected by the dual factors of the bank of japan's "hawkish" remarks and the negative economic data from the united states. the difference is that the vix index, which measures the degree of market panic, rose to more than 20 on september 3, an increase of more than 30%, but it is still far below the historical high of 65 set in early august.

in addition, this round of decline is more concentrated in the heavyweight stocks of technology giants, while other sectors, such as finance, energy, real estate, etc., have relatively developed independent trends, reflecting that investors' concerns are more concentrated in technology-related sectors.

nvidia, which benefited from the craze for generative artificial intelligence, became the hardest hit company that day, which also reflected investors' concerns about the future prospects of artificial intelligence.

the bank of japan's hawkish comments and concerns about a u.s. recession have caused market panic

september 3rd was the first trading day of the u.s. stock market in september. before the opening of the market, bank of japan governor kazuo ueda reiterated that the bank of japan would continue to adopt an interest rate hike policy if the economic outlook met expectations. influenced by this statement, u.s. stocks moved abnormally before the market opened that day, and futures products of the three major stock indexes all fell slightly.

after the opening, poor us economic data further hit market confidence.s&p globaldata showed that u.s. manufacturing production fell for the first time in seven months in august, and economic growth concerns resurfaced. the manufacturing pmi fell to 47.9 from 49.6 in july. at the same time, the u.s. institute for supply management (ism) manufacturing pmi shrank for the fifth consecutive month, lower than the expected 47.5, but higher than 46.8 in july.

affected by the above negative news, the three major u.s. stock indexes all opened lower, without any rebound throughout the day, and accelerated their decline at the end of the day. among the major sectors, technology growth stocks became the hardest hit area that day, among which several major technology giants with a large market value in the united states all experienced significant declines that day. for example, chip giant nvidia fell nearly 10% that day, and its market value fell from 3 trillion u.s. dollars to 2.64 trillion u.s. dollars. after the market closed that day, it was reported that the u.s. department of justice issued a subpoena to nvidia, which may be involved in an antitrust investigation. this news caused nvidia's stock price to continue to fall after the market closed.

other technology giants were also not spared, with apple falling 2.72% on the day.microsoftdown 1.85%, google down 3.94%. dragged down by these heavyweight stocks, the u.s. stock market also fell across the board that day.

the volatility index vix, which measures market panic, soared 33% to 20.72 on the day, but was still far below the highest level of 65 reached by vix during a sharp market decline in early august.

investor enthusiasm for ai wanes

the market crash on september 3 gave u.s. stock investors a sense of déjà vu. just one month ago, global stock markets, including the u.s. stock market, suffered a "black monday". the cause was also the bank of japan's announcement of an interest rate hike, coupled with negative news on u.s. economic data, which led to unusual movements in global markets. the nikkei index once experienced a panic sell-off with a single-day drop of more than 10%, and the u.s. stock market also suffered a significant correction.

but the market quickly recovered. since the beginning of august, the s&p 500 has risen by more than 7% and the nasdaq composite has risen by more than 6%, not only recovering all the lost ground but also setting all-time highs.

market analysts generally attributed the market crash in early august to large-scale yen carry trades. as the bank of japan has maintained a low interest rate policy for a long time, yen carry trades have been popular in the past decade or so. investors engage in risk-free arbitrage by borrowing low-interest yen and exchanging them for other high-interest currencies.

due to the small interest rate differential and other additional transaction costs, yen carry trades require a certain scale of transaction to be profitable, so many investors use leverage to magnify their returns.

however, the risks of leverage become apparent when market conditions reverse. as the bank of japan announced an interest rate hike, the interest rate spread of yen carry trades narrowed and became even no longer profitable. under the magnifying effect of leverage, investors' losses widened. due to margin trading, margin needed to be replenished quickly, which led to a new round of selling, further increasing the downward pressure on the market.

however, the decline on september 3 was not as severe as the previous round. panic in the market was once high in early august, and global markets were affected. the panic index once reached 65, the highest level since the 2020 epidemic and the 2008 financial crisis.

the market plunge on september 3 was mainly due to the drag of heavyweight stocks, with chip giant nvidia being the first to bear the brunt. although nvidia disclosed its second-quarter financial report last week, its main indicators such as revenue and profit still set records and exceeded market expectations, investors are skeptical about whether nvidia's future performance can continue to maintain high growth, which has affected the market's current valuation judgment of nvidia. after a continuous decline, nvidia's market value is less than $3 trillion.

nvidia's stock price performance also largely represents investors' expectations for the future prospects of artificial intelligence. in the past two years, benefiting from the rise of generative artificial intelligence, nvidia's market value has continuously exceeded 1 trillion, 2 trillion and 3 trillion us dollars in a short period of time, and once topped the throne of the world's highest-valued company. based on the optimistic prospects for this round of generative artificial intelligence and nvidia's market position, the market has generously given nvidia an astonishing valuation. at the same time, the outside world's expectations for the development of generative artificial intelligence have also been adjusted recently. at present, the added value brought by generative artificial intelligence has not been effectively reflected in the financial reports, and large companies are still in the "arms race" stage. the next generation of large models of the leading startup openai has been delayed in release, and the frequent turmoil of internal managers has also aroused doubts from the outside world.

asset management giantblackrockin a note to clients this week, the company said recent studies have begun to question whether the additional revenue generated by generative ai can justify previous investments.

“when evaluating individual companies’ capital expenditures on ai, investors should consider whether they are using the capital most efficiently,” blackrock wrote.