1. US: Wall Street rebound led by semis; SMIC guidance fuels margin optimism; All eyes on Google’s capex
Wall Street advanced on Tuesday, with the S&P 500 rising 0.89%, the Dow gaining 0.74% and the Nasdaq composite climbing 1.29%, led by a rebound in semiconductor stocks. Strength in Korea’s Kospi yesterday appeared to spill over into U.S. memory and storage names, including Micron and SanDisk, with gains extending across the broader semiconductor complex.
The move may also have been supported by bargain-hunting funds stepping in after the recent sell-off, while reports that TSMC could raise chipmaking prices by up to 10% in 2027 were interpreted as signs of sustained demand and continued industry pricing power. Additionally, strong Q2 earnings from blue chips such as 3M and General Motors also added to the constructive tone.
Going into Wednesday’s session, some investors are hopeful that SMIC's sharp gross-margin guidance upgrade could bode well for other hardware names, particularly purer AI plays, which might similarly benefit from an improved product mix and better ability to command margins from customers.
All eyes will be on Alphabet's capex outlook after Wednesday's close, as recent trading has reflected a tug-of-war between hyperscalers and AI hardware names: elevated spending has weighed on hyperscalers over cash-flow concerns, while hardware stocks have benefited from the demand signal, and the reverse has played out when capex expectations cool. How the market digests Alphabet's capex guidance will offer a clearer read on whether this dynamic still holds, or if new narratives are beginning to emerge.
2. Debut of SpaceX, Grab, and Sea SDRs on SGX today: broader market participation; deeper liquidity; strengthening Singapore’s role as a multi‑asset hub
The launch of SpaceX, Grab and Sea SDRs marks a positive millstone for Singapore’s equity market.
The addition of high-profile technology stocks is expected to broaden market participation by attracting younger and growth-oriented investors, while further broadening investment themes in Singapore’s equity market beyond established income‑focused offerings.
The expansion of the SDR lineup may also boost trading activity, generating positive spillover effects on liquidity across the broader market.
Additionally, the introduction of US SDRs may serve to raise awareness of the SDR platform, creating a supportive network effect that encourages further listings and strengthens Singapore’s position as a regional multi-asset marketplace.
3. South Korea: leveraged ETFs amplify market moves in both directions
President Lee Jae-myung called for regulatory action on leveraged ETFs yesterday, amid investors’ concerns that such products may be amplifying volatility in South Korea’s equity market. The mechanism may intensify moves in both directions, forcing additional selling during declines and triggering additional buying during rebounds, as seen in yesterday's 3.56% rise in the KOSPI.
4. Singapore: STI gains on semiconductor rebound and earnings optimism
A rebound in semiconductor sector lifted Asian market sentiment, helping the STI start on a stronger note before closing 0.51% higher on 21 July. Gains in heavyweight blue chips, led by Jardine Matheson, added support, alongside broader optimism ahead of the upcoming earnings season.
Banks delivered mixed results, with DBS and UOB edging higher, while OCBC slipped as some investors focused on its comparatively lower dividend yield against peers.
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