Preeti Ayyathurai
3 min read
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A sharp selloff in Asian memory-chip giants rattled global markets. Wall Street looked set for a cautious end to the week on Friday.
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The decline in Samsung Electronics and SK Hynix, two of the world’s largest memory suppliers, sent U.S. chipmakers, including Micron, Western Digital and Sandisk, lower in premarket trading
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A hotter-than-expected inflation reading fueled fresh caution around interest rates on Thursday.
U.S. stock futures were mixed early Friday, following another volatile session for technology stocks, with the Federal Reserve’s preferred inflation gauge surprising to the upside.
A sweeping tech rout across Asian markets, which saw a brief trading suspension on South Korea’s Kospi index after heavyweights Samsung and SK Hynix plunged as much as 10%, weighed on sentiment. Chipmakers such as Micron (MU), Sandisk (SNDK) and Western Digital Corp (WDC) are reeling under pressure in early premarket trade on Friday.
Apple’s (AAPL) and Microsoft’s (MSFT) hardware price hikes reveal that severe memory chip shortages are beginning to directly impact consumer product pricing and strain mega-cap margins.
The annualized PCE index hitting a 31-month high keeps the pressure on the Federal Reserve, tempering near-term hopes for aggressive interest rate cuts. Meanwhile, crude oil prices declined nearly 2% Friday and are headed for steep weekly losses as more tankers resumed transits through the Strait of Hormuz, despite reports that a cargo vessel was attacked near Oman.
As of 4:00 a.m. ET, Nasdaq futures fell 0.7%, S&P 500 futures declined 0.2%, Dow futures rose 0.1%, and Russell 2000 futures were flat with a positive bias.
On Stocktwits, retail sentiment for the SPDR S&P 500 ETF (SPY), an exchange-traded fund that tracks the S&P 500 Index, has slipped to ‘extremely bearish’, while the Invesco QQQ Trust (QQQ) ETF, which tracks the Nasdaq-100 Index, has stayed ‘bullish’.
Trending Stocks To Watch
Micron Technology (MU): A Morningstar analyst warned that the current AI-driven memory boom could eventually give way to a supply glut and a sharp revenue decline. However, retail traders remained overwhelmingly bullish, with most Stocktwits voters expecting the stock to top $1,500 within a year.
Qualcomm (QCOM): Although shares remain on track for one of their weakest months in years, analysts increasingly believe hyperscale cloud providers could become major customers over the next several years.
