Traders on the floor of the New York Stock Exchange, August 1, 2022.
S&P 500 futures fell on Tuesday after another chip maker warned of tough times ahead after Nvidia’s weak outlook in the previous session.
S&P 500 futures lost 0.3% as chip stocks fell in the primary market. Nasdaq 100 futures were down 0.7%. Dow Jones Industrial Average futures were little changed.
micron memory chip It warned that revenue may not meet its previous guidance Because of “macroeconomic factors and supply chain constraints”. The stock is down nearly 4% in early trading.
It’s been a tough week for the chipmakers. On Monday, weaker-than-expected revenue guidance from Nvidia weighed on the group. Nvidia slipped again in pre-market trading on Tuesday, shedding another 3% after dropping 6% on Monday. The iShares Semiconductor ETF lost 1.5% in premarket trading on Tuesday after falling 1.5% on Monday.
During normal trading on Monday, the S&P 500 was down 0.12% and the Nasdaq Composite was down 0.1%. Stocks opened the session higher, but then gave up most of those gains before the closing bell on Monday.
Outside of chips, a pair of Nasdaq-listed stocks also took early hits. Novavax fell 32% In pre-market trading after slashing full-year revenue guidance due to weak demand for Covid vaccines. Upstart fell 13% in premarket trading after the consumer lender reported second-quarter results that missed earnings and revenue expectations.
With the S&P 500 approaching its third positive week in a row, investors are wondering if this return is just a bear market bounce, the beginning of a new sustainable advance.
“I think a retest is a possibility and investors should be careful about buying here,” Jim Lakamp of Morgan Stanley Wealth Management said Monday on CNBC’s “Closing Bell.” “You should use a rally like this to sell some stuff you’re trying to get rid of — you know, you don’t want cheese anymore, you want to get out of the trap.”
On the economic front, investors are waiting for the latest CPI reading for July, due on Wednesday, to find some clarity on the path of interest rate hikes from the Federal Reserve as it works to eliminate, or at least slow, inflation.
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