Speaker 1: Bloomberg Audio Studios, podcasts, radio news.
Speaker 2: The Stock Movers Report, your roundup of companies making moves
Speaker 2: in the stock market, harnessing the power of Bloomberg Data.
Speaker 3: Let's take a look at some stocks on the move
Speaker 3: today in Asia. I'm Stephen Carroll with Caroline Hepker, and
Speaker 3: we're joined by our markets reporter Anthony Stevens for more
Speaker 3: anti the technology story back driving markets today, particularly over
Speaker 3: the latest reports of Chinese advancements and chip make chrip
Speaker 3: equipment making. Let's start this is playing out in the
Speaker 3: Japanese markets.
Speaker 1: Yeah, morning, guys. Again, it's this momentum of Chinese technological
Speaker 1: improvement that is hurting the air chip trade one thing
Speaker 1: at a time. And now we're on the hardware side
Speaker 1: of things. So there is speculation reported by the Information
Speaker 1: that Channel will be able to mass produce deep ultraviolet
Speaker 1: technology etching machines into twenty twenty seven, up to around
Speaker 1: twenty machines. Now this is a very small part of
Speaker 1: kind of ASML's overall market, but it does point to
Speaker 1: the possibility that Channel will be able to manufacture much
Speaker 1: wider range of chips with a much higher capacity, and
Speaker 1: that is smashing kind of simpler chips across Japan. So
Speaker 1: for example, Kyoksha that makes more of the simpler memory
Speaker 1: in the nand space is down eighteen percent. Some of
Speaker 1: the MLCC capacitor names, the testing names, these are down
Speaker 1: double digits. For example, Ibiden is down eleven percent, Tokyo
Speaker 1: Electron is down eleven percent. And these are some of
Speaker 1: the biggest moves that you've seen in single names within
Speaker 1: the Japan index in a very long time on a
Speaker 1: single day. What's keeping the index up, on the other hand,
Speaker 1: kind of ironically, is the people that consume the chips,
Speaker 1: so Nintendo and Sony.
Speaker 4: Yeah, that's really interesting. Look, we're going to have to
Speaker 4: watch a SML. You know, their share price was down
Speaker 4: as a result of that reporting, as you say, representative
Speaker 4: for SML decline is common. I mean, it's going to
Speaker 4: be a very very interesting story getting forwards, isn't it.
Speaker 4: What all of this means having that also massive volatility
Speaker 4: to tying a written markets how the big chip names
Speaker 4: taking the news.
Speaker 1: Yeah, Korea as an index does not have that kind
Speaker 1: of buffer of domestic names or any kind of offset whatsoever. Right,
Speaker 1: it's just pure chip names. And when Heinex is down
Speaker 1: thirteen percent, you're probably heading to a very bad day.
Speaker 1: To add to that, every other smaller component within the
Speaker 1: chip ecosystem is also struggling. For example, Samsung electro Mechanics
Speaker 1: is down seventeen and a half percent, and that led
Speaker 1: to Korea being halted today on a circuit breaker when
Speaker 1: the market crapped out eight percent and it's kind of
Speaker 1: stayed there and traded below that, which is generally speaking
Speaker 1: quite a bad sign for Korea. In the past kind
Speaker 1: of episodes of a circuit breaker, it's bounced up quite strongly.
Speaker 1: What is in question here now is whether these Chinese
Speaker 1: DEUV machines a love China to build out massive memory
Speaker 1: capacity that offsets their HBM disadvantage.
Speaker 3: And while all of this is happening and the pressure
Speaker 3: on chip companies, some software companies right benefesting.
Speaker 1: Yeah, this is an aspect of the kind of factor
Speaker 1: investing that quanti investors, amongst others are engaged in. So
Speaker 1: high momentum trades have been the standout performer in the
Speaker 1: year as the AI trade got going, and now they've
Speaker 1: reversed really really hard. So the GS high momentum long
Speaker 1: shot basket was down seven percent per second day in
Speaker 1: a row, and the other side of long momentum in
Speaker 1: tech is short software, and so as people unwind their
Speaker 1: long AI hardware space, they have to cover their software shots,
Speaker 1: and we're seeing that across the region. We're seeing, for example,
Speaker 1: in Hong Kong the HS tech trade a lot better
Speaker 1: than the Chinese and names like king d International Software
Speaker 1: that's up two point three percent, and even software in
Speaker 1: Japan is trading slightly up on the day. Bay Current
Speaker 1: is slightly up on the day, so that's probably going
Speaker 1: to carry over to the US. We saw a very
Speaker 1: decent dynamic on Friday, sorry yesterday, when all of these
Speaker 1: software names for trading quite well despite tech semiconductors getting hit,
Speaker 1: keeping the SMP flat overall.
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