CNBC's Jim Cramer said on Tuesday that the semiconductor industry is experiencing a turning point and showing signs that the global economy may be stronger than previously expected.
He mentioned that Nvidia's acquisition of Israeli chipmaker Mellanox and Bank of America upgraded Apple stock for about $6.8 billion in cash may mean that excess chip inventory may disappear and the semiconductor industry is trying to overcome the 2018 crisis. Come back.
“Now the semiconductor company has touched on all aspects,” CNBC’s “Crazy Money” host said. “When we talk about the economy, the weight of the house exceeds its original 'weight'. If the housing market is strong, then the strength may Spread to the banking and retail industries. Today, in the new data-driven global economy, the price of semiconductor stocks is much higher than its weight, just like housing."
He pointed out that semiconductors once led the market until the market segment began to get into trouble in the spring of 2018. These include Skyworks' exposure to China as a result of the trade war, US regulators rejecting Broadcom's acquisition of Qualcomm, Chinese regulators refusing Qualcomm's acquisition of NXP Semiconductors, and NVIDIA's poor prospects for gaming, artificial intelligence and data centers.
“Therefore, the above situation has caused the industry to have no more transactions, and the demand for automotive chips has declined, including China’s smashing of mobile phone chips, resulting in a large number of chips, and the peak of data centers and games. The entire chip manufacturer is showing the world. The economy is slowing down," Jim Cramer said.
But he said that as both the US and US data centers and trade negotiations seem to be improving, the outlook is better than ever. In addition, NVIDIA's move to acquire Mellanox doubled the share price in the data center and artificial intelligence sectors and eased concerns about China's blocking of the deal.