Fed Holds Rates, Still Worried About Inflation Internally
The U.S. Federal Reserve announced on October 28 that it would keep the federal funds rate target range unchanged at 3.75% to 4.00%, in line with market expectations. The decision passed by 10 votes to 2, with the two dissenters favoring a 1-code hike, showing vigilance over inflation risks. The statement said U.S. economic activity remained strong, domestic spending was resilient, and business capital investment was active, but inflation remained elevated, and policy will be adjusted in light of economic data going forward. Unchanged rates do not mean a shift toward easing, with U.S. long-term bond yields and corporate borrowing costs remaining important factors for technology investment.
Alphabet Cloud Doubles, But Tumbles Over 10% After Hours
Alphabet reported its 2026 third-quarter results, with quarterly revenue of about $127.58 billion, up 25% year-on-year, including Google Cloud revenue of about $30.71 billion, up 103% year-on-year, showing strong demand for AI infrastructure. But third-quarter capital expenditure was about $51.36 billion, operating cash flow was about $42.29 billion, and free cash flow was about negative $9.07 billion, and with overall revenue and profit missing some market expectations, the stock fell more than 10% at one point in after-hours trading. Market focus has shifted from revenue growth to capital expenditure and the investment payback period.
PHLX Rebounds 1.76% 台積電 ADR Moves Higher
U.S. stocks closed higher across the board on October 28, with the Dow up 0.19%, the S&P 500 up 0.28%, the Nasdaq up 0.27%, and the Philadelphia Semiconductor Index up 1.76%, closing at 11684 points. 台積電 ADR rose 0.60% to close at $439.51. The PHLX has continued to rebound since its 6.72% plunge on October 22, showing revived confidence in AI chip demand. Cloud operators expanding data centers is driving demand for high-end chips, AI servers, networking and cooling, linked to the 台積電, 鴻海, 廣達, 緯穎, as well as 台光電, 台燿, 金居 supply chain, but revenue growth may not translate into gross margin improvement.
Taiwan Stocks Return Above 47000 as Institutions Buy Together
Taiwan stocks surged 939.35 points on October 28 to close at 47035.58 points, up 2.04%, returning above the 47000 mark, with centralized market turnover of about 7221.35 billion yuan. 台積電 rose 25 yuan to close at 2425 yuan, 聯發科 rose 6.94% to close at 4235 yuan. The three major institutional investors bought a net total of about 298.94 billion yuan, including 159.22 billion yuan by foreign investors, 118.07 billion yuan by investment trusts, and 21.65 billion yuan by dealers. Whether 47000 can be held on the 29th will depend on U.S. technology stock performance, buying in electronic heavyweights, volume and foreign investor moves, and whether massive AI spending can translate into sustained profits.