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Chip Stocks Tumble Amidst Confluence of Bad News
28 Jul
Summary
- Chip stocks extended losses for a third consecutive day.
- Nvidia and AMD shares dropped 5%, with Seagate down 4%.
- ASML NV shares fell 6% on reports of Chinese competition.
The semiconductor sector faced significant losses for the third consecutive trading day on Monday, as a combination of negative news weighed heavily on major players. Nvidia and AMD shares each saw a 5% decrease, while Seagate's stock fell by 4% in anticipation of its upcoming earnings announcement.
These declines contributed to a volatile start for US equities on Wall Street, with the Nasdaq Composite and Nasdaq 100 indices experiencing notable pullbacks from their intraday highs. The broad sell-off in chipmakers offset gains seen from a dip in crude oil prices, despite ongoing concerns about attacks on oil facilities.
Further compounding the pressure on chip stocks, ASML NV shares dropped 6% following reports that a Chinese state-backed firm is developing chipmaking machinery that could pose a threat to its market share. In related news, SK Hynix ADRs closed below their IPO price, and shares of Micron and Western Digital also saw declines.
Market participants are also closely monitoring the upcoming US Federal Reserve interest rate decision, with some analysts suggesting a potential surprise rate hike could be announced. This anticipation adds another layer of uncertainty to an already turbulent market landscape.
