Direxion 3x Inverse Semiconductor ETF once surged over 8%
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Glonghui, May 12|The 3x Inverse Semiconductor ETF-Direxion (SOXS.US) hit a historic low of $8.15 intraday yesterday and ultimately closed down 7.34%, plummeting 86.8% year-to-date. Today, pre-market US stocks rebounded by over 8% at one point (UTC+8), but after the release of the US April CPI data, the market plunged and gains narrowed to just over 5% (UTC+8). In terms of news, at 20:30 (UTC+8), the US April CPI data showed: April US CPI rose 3.8% year-on-year, the highest since May 2023, beating market expectations of 3.7%; the month-on-month growth rate fell to 0.6%, the lowest since February this year, in line with market expectations, with the previous value being a 0.9% increase. US April core CPI rose 2.8% year-on-year, the highest since September 2025, exceeding market expectations of 2.7%; month-on-month growth was 0.4%, the highest since January 2025, above the market expectation of 0.3% and the previous reading of 0.2%. Renowned investor Michael Burry warned that the current market situation is similar to the highs before the dot-com bubble burst. Chip stocks have surged sharply in the near term, with the Philadelphia Semiconductor Index up nearly 70% since the end of March. According to his calculations, the Nasdaq 100 Index currently has a PE ratio of about 43x, far above the “fair level” of around 30x, as “Wall Street has overestimated profits for the fastest-growing, most highly valued companies by 50%.” Burry said: “We are witnessing history. In the stock market, this is usually not a good thing.” He likened the current situation to “the final few minutes before a horrific car crash.” However, Burry advises not to short stocks, as the cost of put options is high and it is easy to suffer losses due to poor timing.
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