Chip stocks took a sharp hit after ASML, a leading chip equipment maker, lowered its annual sales forecast due to weak demand for non-AI chips. This downturn raised concerns about the broader semiconductor market, even as AI-related chips remain in high demand. Nvidia, a major player in the AI chip sector, saw its stock drop 4.5%, erasing $158 billion in market value, while other key chipmakers like AMD, Intel, and Micron also saw declines.
ASML’s early results revealed a slowdown in bookings and delayed orders from logic chip manufacturers, as well as limited new capacity plans from memory chip makers. This caused US and Asian semiconductor stocks to slide, with the Philadelphia Semiconductor Index down nearly 5%. Despite growth in AI chips, the overall chip market remains under pressure, with many factories holding off on new equipment purchases as demand stabilises.
The chip industry had expanded rapidly during the pandemic, but now faces a period of slower recovery outside the AI segment. Adding to the uncertainty, US officials are considering restrictions on exporting AI chips to certain countries over national security concerns, further complicating the outlook for the sector.
Google is enhancing its Shopping tab with AI, building on its previous integration of generative AI into Search in 2023. The company announced it will use AI technology to help users find products that match their specific needs. The update includes a new, personalised feed of shoppable products, offering a scrollable, TikTok-inspired design.
When users search for a product, an AI-generated brief will provide personalised tips and considerations based on their query. For example, if someone searches for a “men’s winter jacket for Seattle,” the AI might recommend prioritising water resistance for the rainy climate and suggest insulation types suitable for the milder temperatures.
Google’s AI will recommend relevant products, offering brief descriptions to explain why each item is a suitable choice. Users can browse categories like “Synthetic insulated winter jackets for Seattle” and use filters to refine their search based on specific sizes or local availability.
The personalised shopping feed will showcase products and videos tailored to user preferences, featuring items like Chelsea boots alongside YouTube Shorts with shopping tips. Google is positioning itself to compete with TikTok, which has gained traction in e-commerce. These new features will roll out in the US in the coming weeks, as Google combines its Shopping Graph with advanced Gemini models to enhance the user experience.
Blackstone, the world’s largest alternative asset manager, is set to invest €7.5 billion ($8.2 billion) in developing data centres in Aragon, Spain, further establishing the region as a key cloud computing hub in Europe. This investment follows similar moves by tech giants like Microsoft and Amazon, who are also investing heavily in data centre projects in the area.
The US private equity firm will concentrate on building facilities with cooling systems and cable connections, which will be leased to companies for server installations. The Aragon regional government has indicated that 19 data centre projects are currently pending approval.
In recent announcements, Microsoft revealed plans for a €6.69 billion investment in Aragon, while Amazon’s AWS intends to invest €15.7 billion in its own data centres. Notably, Amazon has committed to powering its facilities with renewable energy, leveraging Aragon’s significant wind power resources.
Coinbase has filed a motion seeking partial summary judgment in its ongoing legal battle against the US Securities and Exchange Commission (SEC). The cryptocurrency exchange aims to access internal SEC documents, hoping to gain insight into the regulator’s approach toward the crypto industry. This stems from the SEC’s decision to deny requests under the Freedom of Information Act (FOIA) for crucial records on its enforcement strategies.
Coinbase, through History Associates, has been attempting to understand the SEC’s stance on digital assets, especially concerning the regulation of cryptocurrencies as securities. The SEC initially withheld documents under law enforcement exemptions but later acknowledged that these protections might no longer apply. Despite this, the regulator has delayed the document review process for three years, which Coinbase argues is unwarranted.
This motion is part of Coinbase’s broader efforts to challenge the SEC’s regulatory approach to the crypto sector, which many believe lacks clear guidelines. The case highlights the need for transparency regarding how the SEC enforces securities laws in the rapidly growing digital asset space.
Cryptocurrency investment products saw a surge in inflows during 5–11 October, totalling $407 million, with Bitcoin leading the charge. Bitcoin investment products attracted $419 million, while short-Bitcoin investments saw outflows of $6.3 million. This significant uptick comes as political developments in the US, particularly polls favouring Republicans in the upcoming elections, appear to have boosted market confidence in Bitcoin.
CoinShares’ head of research, James Butterfill, highlighted the political shift as the main driver behind the increase in crypto inflows, noting that economic data had little impact on stemming outflows from the previous week. Investors seem to view Republicans as more supportive of digital assets, leading to a rise in Bitcoin’s price, which climbed by more than 2%.
Meanwhile, blockchain ETFs saw their largest weekly inflows of 2024, totalling $34 million. However, Ethereum continued its trend of outflows, with $9.8 million withdrawn from Ether products last week, indicating a contrast in investor sentiment between Bitcoin and Ethereum.
On Monday, Britain announced a major investment of £6.3 billion ($8.2 billion) by US companies ServiceNow, CyrusOne, CloudHQ, and CoreWeave in UK data centre technology. This announcement aligns with the UK government’s broader economic plans, as Prime Minister Keir Starmer hosts the International Investment Summit in London, gathering hundreds of global business leaders.
At the summit, the government is set to unveil an additional £50 billion ($65 billion) in new investments aimed at stimulating growth in sectors like AI, life sciences, and infrastructure. Starmer, emphasising the importance of private sector involvement, aims to create a stable environment that fosters economic expansion, aligning with his Labour Party’s commitment to boosting the economy.
The event will also feature discussions between ministers and business leaders on capitalising on opportunities in emerging industries, including health tech, clean energy, and creative sectors.
A significant collaboration between Taiwan’s PSMC and Japan’s SBI Holdings to build a semiconductor fab in Japan has been abruptly halted. PSMC informed SBI Holdings in late September that it could not proceed with the project, initially promised a year ago. SBI Holdings Chairman Yoshitaka Kitao expressed his frustration on social media, accusing PSMC of dishonesty and labelling the breakup as ‘a blessing in disguise.’
Kitao criticised the dissolution of the partnership, stating it was the first time SBI had to end a collaboration almost unilaterally after making significant concessions. He recalled discussions with key government officials and detailed plans for receiving Japanese government subsidies, only to be let down by PSMC’s failure to honour commitments. According to reports, PSMC cited an unwillingness to assume the risks associated with the project, leading to the termination of plans for the facility in Miyagi Prefecture, which was expected to start production by 2027.
The decision comes as PSMC has faced challenges in the semiconductor market, including oversupply issues from Chinese firms, resulting in operating losses for five consecutive quarters since Q2 2023. While PSMC intended to offer consulting, training, and technology transfer under a Fab IP model without directly investing in the factory, it raised concerns about the conditions set by Japan’s Ministry of Economy, Trade and Industry regarding operational guarantees.
US Vice President Kamala Harris is strengthening her connection with the cryptocurrency community through her “Opportunity Economy” agenda. She is set to speak with Black entrepreneurs in Erie, Pennsylvania, discussing her support for small businesses, cryptocurrency regulation, and cannabis legalisation at the federal level. The initiative aims to empower Black men by providing tools for home ownership, business creation, and wealth building.
Harris’s campaign has shifted its stance on digital assets. Once seen as part of an anti-crypto regime, her current position favours regulatory frameworks that protect crypto investors, including Black men who own such assets. Ripple co-founder Chris Larsen’s $1 million donation to her campaign signals a growing belief that Harris may work on bipartisan crypto legislation.
Despite this support, not everyone in the crypto community is convinced by her campaign’s shift. However, Harris remains focused on protecting crypto ownership rather than restricting it.
The Central Bank of Brazil has opened the second phase of its digital currency pilot, Drex, inviting companies to apply from 14 Oct. to 29 Nov. The initiative aims to explore complex use cases for the tokenised real, including government-backed loans, agribusiness assets, and carbon credits. Thirteen proposals have already been approved, advancing Brazil’s push toward integrating blockchain into its financial system.
The first phase of the Drex pilot saw 16 consortiums, mostly led by banks, testing the digital real through decentralised networks. However, privacy concerns remain, with four participants yet to resolve transaction anonymity issues. Brazil’s Securities Commission president stressed that tokenisation is a business model poised for long-term success and must be regulated within the financial system.
Brazil’s efforts to develop its CBDC align with global trends. The Atlantic Council notes that 134 countries are considering CBDCs, with Brazil among the 65 most advanced. China, meanwhile, has made significant strides, with its digital renminbi, e-CNY, reaching $1.02 trillion in transactions by 11 October.
Nvidia’s shares reached a record high on Monday, pushing the AI chipmaker closer to overtaking Apple as the most valuable company in the world. Closing at $138.07, Nvidia’s stock surged 2.4%, driven by investor optimism around demand for both current and future AI processors. The company’s market value now stands at $3.39 trillion, just shy of Apple’s $3.52 trillion.
The fierce competition among leading tech firms has propelled Nvidia to become Wall Street’s biggest success story in the AI race. In June, the company briefly held the title of the world’s most valuable firm before being overtaken by Microsoft. Analysts from TD Cowen highlighted how major AI players face constant pressure to invest, fearing the risk of falling behind in the fast-evolving sector.
Nvidia has been working to meet increasing demand, despite delays in its upcoming Blackwell chip production. The company confirmed that production was postponed until the fourth quarter, although customers remain eager to purchase the current generation of chips. TD Cowen maintained Nvidia as its ‘Top Pick’, with a $165 price target, citing the ongoing demand for its processors.
As Apple and Microsoft also recorded gains, Nvidia, Apple, and Microsoft now account for nearly a fifth of the S&P 500’s total weight. Taiwan Semiconductor, which manufactures Nvidia’s processors, is expected to report a 40% rise in profits later this week, further reflecting the soaring demand for AI technology. Nvidia’s revenue is projected to more than double to approximately $126 billion this year, supported by spending on AI data centres.
