Traders on the NYSE floor, August 1, 2022.
Source: NYSE
S&P 500 futures fell on Tuesday after another chipmaker warned of tough times following Nvidia’s poor forecast in the previous session.
S&P 500 futures lost 0.3% as chip stocks fell in premarket. Nasdaq 100 futures fell 0.7%. Dow Jones Industrial Average futures were little changed.
Memory chipmaker Micron warned that revenue may be below its previous guidance due to “macroeconomic factors and supply chain constraints.”
It’s been a tough week for chipmakers. Weaker-than-expected revenue guidance from Nvidia weighed on the group on Monday. Nvidia was lower again in premarket trading on Tuesday, losing another 3% after a 6% drop on Monday. The iShares Semiconductor ETF lost 1.5% in premarket trading on Tuesday after falling 1.5% on Monday.
The S&P 500 has risen for three straight weeks, but the earnings season has seen demand warnings from big company executives. Investors are watching closely to determine how the Federal Reserve’s fight against inflation is affecting the economy.
“In our view, the Fed’s rate hikes are hitting the economy in a one-time fashion. We believe that tightening is just beginning to broadly affect the economy and that our medium-term bearish base case holds intact,” Wolfe Research’s Chris Senyek said in a note. to customers on Tuesday.
Outside of chips, a couple of Nasdaq-listed stocks were also taking early hits. Novavax fell 32% in premarket trading after it cut full-year revenue guidance due to weak demand for its Covid vaccines. Upstart fell 13% in premarket trade after the consumer loan company reported second-quarter results that missed expectations for profit and revenue.
On the economic front, investors await the latest reading of the July consumer price index, due on Wednesday, for some clarity on the path of interest rate hikes from the Fed as it works to curb inflation, or at least slow it down.