On February 22, Japan** continued to rise, and the Nikkei 225 index broke through 39,000 points in one fell swoop, exceeding the all-time high set on December 29, 1989 during the bubble economic period, and as of **, the Nikkei 225 index rose 219% to 3909868 points, **a record high, year-to-date total**over 168%。
Regarding the outlook for Japanese stocks, CICC pointed out in its latest report that the Nikkei index is likely to break through the 40,000-point integer mark in 2024 due to the inflow of foreign funds, the continued moderate growth of the global economy and the Japanese economy, the realization of the "cycle of wage increases and price increases" in Japan, the continuous development of the "special valuation of Japan" policy, and the changes in the "conversion of savings into investment" of Japanese households.
In terms of A-shares, brokerage stocks moved in the afternoon, with Everbright**, Huachuang Yunxin, Capital **, Huaxin Shares, and Jinlong Shares among the top gainers. The Shanghai Composite Index extended its gains to 1%, and the Shenzhen Component Index rose 0.6%, the GEM index rose 019%。CNOOC rose more than 4% and its stock price hit a record high, PetroChina rose more than 4%, and Sinopec rose more than 2%; In terms of Hong Kong stocks, CNOOC rose more than 5% to a record high, and PetroChina shares rose more than 5%.
In addition, there is also big news from the United States. On February 21, Eastern time, American chip giant Intel held its first wafer foundry event in San Jose, California. U.S. Commerce Secretary Gina Raimondo said at the event that if the U.S. wants to "lead the world" in semiconductors, it will need to further increase subsidy investment, such as the enactment of a second CHIPS Act.
Japanese stocks broke through 39,000 points!
On February 22, Japan** continued to rise, and the Nikkei 225 index once exceeded 39,000 points intraday, exceeding the all-time high set on December 29, 1989 during the bubble economy period, and as of **, the Nikkei 225 index rose 219% to 3909868 points, **a record high, year-to-date total**over 168%。
Today, the sharp rise of the Nikkei 225 index was mainly driven by chip stocks, among which, screen once soared by 99%, DISCO rose more than 9%, and Tokyo Electron rose 56%, Advantest rose 63%, Renesas Electronics rose more than 5%, and Lasertec rose 53%。
CICC's latest report reviewed this round of Japanese stock bull market and concluded that the EPS (earnings per share) increase in Japanese stocks in the past ten years is due to the continuous improvement of corporate earnings due to Japanese companies actively going overseas and seizing the global market.
The reason for the rapid growth of EPS in Japanese stocks is that the performance of Japanese companies is the logic of the global economy, not the Japanese economy; The profitability of Japanese companies continues to improve.
According to data from the CICC report, from the beginning of 2013 to February 2024, the Nasdaq was the strongest performer among the world's major stock indexes (**400%), followed by the Nikkei and the S&P 500 (up about 270%), followed by the Topix and Dow Jones (up about 200%).
40,000 points?
Regarding the outlook for Japanese stocks, CICC pointed out in the report that there is a possibility that the Nikkei Stock Average will break through the 40,000-point integer mark in 2024. Compared with the more than 38,000 points of Japanese stocks in 1989, the valuation level of Japanese stocks is more reasonable, the profitability is better, there are more globally competitive companies and better corporate governance.
From the perspective of investor structure, the current foreign institutional investors are the largest holders and traders of Japanese stocks, and Japanese stocks rise rapidly when foreigners are active; The Bank of Japan has held about 7% of Japanese stocks in the past 10 years, and CICC believes that there is no need to worry about selling risks in 1-2 years; In the past 10 years, the company has actively implemented the first repurchase and "daily special valuation" to play an accelerating role; Individual investors have been net sellers of Japanese stocks since the collapse of the bubble economy, but individual investors hold a large amount of cash, and if they can achieve "from deposit to investment", it will bring a boost to Japanese stocks.
CICC said that in the context of inflation, Japan is more suitable to increase leverage and buy inflation-resistant assets (the same is true of Buffett's operation). Historically, the impact of Bank of Japan rate hikes on Japanese stocks has been relatively limited.
CICC reminded that it is bullish on Japanese stocks in the long term, but it is still necessary to pay attention to the risk of Japanese stocks in the short term. The Japanese economy is susceptible to external influences, and in the past half century, every time the United States has fallen into recession, the Japanese economy has also fallen into recession, and if the United States economy falls into recession in the future, the Japanese economy will most likely also be "brought into" a recession.
Big news suddenly broke from the United States
On February 21, Eastern time, American chip giant Intel held its first wafer foundry event in San Jose, California. U.S. Commerce Secretary Gina Raimondo said at the event that if the U.S. wants to "lead the world" in semiconductors, it will need to further increase subsidy investment, such as the enactment of a second CHIPS Act.
Biden officially signed the CHIPS Act in August 2022, promising to provide more than $52 billion in subsidies for the research and production of semiconductors in the United States, and will also provide investment tax credits for chip factories.
But at Wednesday's event, Raimondo said that a CHIPS Act alone would not be enough for the United States to regain leadership in the semiconductor chain.
To be clear, we can't and don't want to make everything in the United States. We don't want all chips to be made in the United States. It's not a reasonable goal," Raimondo added, "but we do need to diversify our semiconductor chain and have more manufacturing in the U.S., especially cutting-edge chips, which is critical for AI." ”
Raimondo also mentioned that she has spoken with OpenAI CEO Sam Altman, who is working to get US** approval for a large-scale joint venture to facilitate the global manufacturing of AI chips.
Raimondo revealed that when she spoke to other customers in the industry, the number of chips they needed was incredible.
Since the passage of the U.S. CHIPS Act in 2022, as of now, although more than 170 chip companies around the world have applied for subsidies under the Act, the U.S. Department of Commerce has only issued 3 smaller subsidies.
Earlier this week, chipmaker Globalfoundries received the bill's third and largest grant to date, $1.5 billion (10.8 billion yuan).
As an American chip giant, Intel is also one of the companies that applied to receive funding subsidies from the CHIPS Act. Earlier this month, Intel reportedly had plans to delay the completion of its new chip factory in Ohio until 2026.
The outside world speculates that the delay in the realization of the United States' ** subsidies is one of the reasons for delaying the progress of Intel's factory construction.
However, there have been recent reports citing informed sources that Biden in the United States is negotiating more than $10 billion in subsidies to Intel.
At Wednesday's event, Intel CEO Pat Gelsinger said the announcement of receiving the subsidy would be made "soon."