S&P 500, Nasdaq futures fall Tuesday as chip stocks fall

Traders on the floor of the NYSE, August 1, 2022.

Source: NYSE

S&P 500 futures fell on Tuesday after another chipmaker warned of tough times ahead following Nvidia’s poor forecast in the previous session.

S&P 500 futures lost 0.3% as chip stocks fell in premarket trading. Nasdaq 1[ads1]00 futures fell 0.7 percent. Dow Jones Industrial Average futures were little changed.

Memory chip maker Micron warned that revenue could fall below previous guidance due to “macroeconomic factors and supply chain constraints.” The stock fell nearly 4% in early trading.

It’s been a tough week for chipmakers. On Monday, weaker revenue guidance from Nvidia weighed on the group than expected. Nvidia was lower again in premarket trading on Tuesday, losing another 3% after a 6% decline on Monday. The iShares Semiconductor ETF lost 1.5% in premarket trading Tuesday after falling 1.5% on Monday.

The S&P 500 has climbed for three straight weeks, but earnings season has featured demand warnings from executives at major companies. Investors are watching closely to see how the Federal Reserve’s fight against inflation ripples through the economy.

“In our view, the Fed rate hikes are impacting the economy over the long term. We believe that the tightening is just beginning to hit the economy broadly, and that our bearish base case over the medium term remains intact,” Chris Senyek of Wolfe Research said in a note. to customers on Tuesday.

Outside of chips, a couple of Nasdaq-listed stocks also took early hits. Novavax fell 32% in premarket trading after cutting full-year revenue guidance due to poor demand for its Covid vaccines. Upstart fell 13% in premarket trading after the consumer loan company reported second-quarter results that missed both profit and revenue expectations.

On the economic front, investors await the final reading of the July consumer price index, due on Wednesday, for some clarity on the path to rate hikes by the Fed as it works to stem inflation, or at least slow it.

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