US Stock Trend (July 28): Apple Overtakes NVIDIA to Regain Top Market Cap, Semiconductor Sector Plunges Over 5%

By: TechFlow Research

The plunge in crude oil should have been the biggest positive for US stocks on Monday, with WTI falling 7.5% in a single day, but this boost was completely buried by the collapse of chip stocks. The Philadelphia Semiconductor Index once plummeted 5% intraday, Nvidia fell nearly 5%, and Apple took the opportunity to overtake and top the market cap chart. Memory chips were the hardest hit, SK Hynix US ADR broke below the IPO offering price, and SanDisk lost 170 billion USD in market cap within a month. Chinese concept stocks were the only highlight of the day, rising 2.5% against the trend, with Xiaomi ADR up nearly 9%. Trump continued to signal that the US and Iran were in "deep negotiations," but Saudi oil facilities were suspected of being attacked again.

Three Major Indices Mixed, Oil Plunge Fails to Boost Market

The S&P 500 rose 0.02%, closing at 7413.18 points. The Dow rose 0.51%, closing at 52210.08 points. The Nasdaq Composite fell 0.18%, closing at 24932.081 points, and the Nasdaq 100 fell 0.32%, closing at 28039.211 points. The Russell 2000 rose 0.62%, closing at 2948.035 points. The VIX rose 0.48%, closing at 18.67.

Apple Overtakes Nvidia, Reclaims Global Market Cap Crown

The Magnificent Seven showed divergent performance, with Apple up 1.17%, Microsoft up 1.94%, Google A up 2.13%, while Nvidia fell 4.99%, Tesla fell 1.22%, Amazon fell 0.31%, and Meta fell 0.22%. Apple's market cap rose to approximately 4.93 trillion USD, while Nvidia fell back to 4.78 trillion USD, changing the market cap ranking. Apple's stock price has accumulated a 24% gain this year, and its steady capital expenditure rhythm unexpectedly made it a safe haven in this round of AI anxiety.

Memory Chips Collapse Across the Board, Chinese Stocks Counter Trend

The Philadelphia Semiconductor Index closed down 2.23%, at 11554.88 points. TSMC ADR fell 1.03%, AMD fell 5.17%, and ASML fell over 5%. The memory sector was particularly brutal, Micron fell 2.25%, SK Hynix plunged 10% intraday at one point, closing below the US IPO offering price, SanDisk plummeted over 11%, and Kioxia ADR also fell over 7%.

The direct trigger for this sell-off came from across the ocean. Chinese memory chip manufacturer CXMT listed on the STAR Market that day, surging over 45% at opening, with market cap once exceeding Intel; the market interpreted this signal as China's progress in DRAM self-sufficiency being faster than expected. Samsung Electronics was subsequently reported to be considering purchasing Chinese-made DRAM to lower costs; these two news items combined directly hit the valuation logic of US memory stocks.

However, most institutions' judgments were not that pessimistic, generally believing that the technical advantages accumulated by Micron, SK Hynix, and Samsung in the AI memory field cannot be shaken in the short term, and this drop might ultimately just be a free bargain for those daring to take over.

Chinese concept stocks were one of the few sectors rising against the trend that day, with the Nasdaq Golden Dragon China Index up 2.51%, closing at 6257.87 points, approaching the 50-day moving average. Xiaomi ADR rose 8.97%, Baozun rose 12.8%, EHANG rose 7.5%, NetEase rose 3.5%, and Pinduoduo, Tencent, and Alibaba all rose over 2%.

Nvidia Circular Financing Alarm Rings

There was another layer of reason for Nvidia's decline that day. The company's Credit Default Swap spread surged 14 basis points in a single day, hitting a historical record, and the market is increasingly worried about this business model intertwined with investment and guarantees.

Nvidia's latest disclosure plans to provide up to 250 billion USD in financing guarantees for OpenAI's data center project in Ohio, plus previous cooperation with SK Group exceeding 500 billion USD; in the entire AI infrastructure ecosystem, Nvidia plays the three roles of supplier, investor, and guarantor simultaneously. This structure of giving itself orders and providing its own backstop makes many investors worry that once some link fails, risks will transmit rapidly along this chain.

Goldman Sachs' Chris Hussey proposed an angle, attributing the stagnation of the S&P 500 in the past two months to the market's doubt itself on whether AI infrastructure investment can continue to make money, with oil prices and interest rates being secondary factors. If AI concept stocks were excluded that day, the remaining part of the S&P 500 actually rose 0.8%, performing better than the overall market, a number that supports his view from the side.

US-Iran Ceasefire Signals Chaotic, Saudi Facilities Attacked Again

Trump's external statement was that the US and Iran sides were conducting "very deep negotiations," describing himself as very patient with ample time; the negotiation focus was reportedly concentrated on reopening the Strait of Hormuz and restarting the nuclear agreement. But the official Iranian tone completely did not match, with the Tehran side directly denying any consultations were taking place, and emphasizing they would not let the US unilaterally decide when this conflict starts or ends.

A key oil facility of Saudi Aramco located in Abqaiq was suspected of being attacked and caught fire; the sensitivity of this location is no less than the Strait of Hormuz itself, and market sentiment therefore tightened noticeably. At the same time, reports mentioned that inside the Pentagon, there is worry that US military air defense interceptor missile reserves in the Middle East are being consumed too fast, which objectively also limits the space for the US side to further expand the scale of strikes.

The Israeli Prime Minister has already departed for Washington and will communicate with Trump face-to-face on the Iran issue; Trump himself admitted that both sides still have divergences on specific handling methods.

Fed Decision Suspense Increases Sharply, Rate Hike Probability Triples in One Week

This week's interest rate futures show that the probability of the Fed hiking rates by 25 basis points at this meeting has risen to the 34% to 38% range; a week ago this number was only about 13%. This situation of probability swinging violently near the decision is not common.

Bloomberg's Sebastian Boyd pointed out a contradiction: on one side, officials' statements are becoming increasingly hawkish, with Logan and Hammack consecutively issuing rate hike warnings, and Governor Waller also saying the risks facing the US have completely shifted; on the other side, short-term inflation expectations have dropped to the lowest point in over a year, and long-term inflation expectations have also been continuously falling these past few months. The secondary transmission effect of oil prices pushing up inflation, previously worried about, has not yet truly appeared.

Earnings Season Enters Main Battlefield, Seven Giants All Appear This Week

This week, approximately one-third of S&P 500 market cap companies will announce earnings sequentially, with Microsoft, Meta, Amazon, and Apple all included. Morgan Stanley's Chris Larkin reminded that geopolitics and oil prices may be the biggest uncertainty factors this week, but even if the performance delivered by the Seven Giants themselves is very strong, as long as the level of AI spending continues to be questioned by the market, stock prices may not necessarily have a positive reaction.

JPMorgan Chase's team is maintaining a tactically bullish stance, believing that declining bond yields, a weakening USD, plus strong corporate earnings, will leave considerable upside space for the S&P 500, but overly crowded semiconductor positions and the Iran conflict remain the biggest risk points.