Nasdaq dragged lower by chip stocks, energy stock bolster S&P
NEW YORK (Reuters): The Nasdaq Composite opened lower on Friday as weak forecasts from Applied Materials and Nvidia weighed on chip stocks, while gains in energy stocks due to rising crude prices helped the S&P and the Dow Industrials cut their losses.
Applied Materials sank 9 per cent, the most on the S&P, after the world’s largest supplier of chip equipment forecast current-quarter results below estimates, adding to fears that a two-year chip boom may be losing steam.
Nvidia dropped 4 percent after the chipmaker said cryptocurrency-fueled demand had dried up and forecast current-quarter sales below Wall Street estimates. The Philadelphia Semiconductor Index dropped 1.49 percent, falling for the fourth straight session. Intel slipped 0.3 percent.
The broader technology sector.SPLRCT fell 0.38 percent, the most among the 11 major S&P sectors. The best performing was the energy sector.SPNY, which rose 0.39 percent as crude prices jumped 1%. Prospects of more US sanctions on Turkey escalated after a report that a Turkish court rejected an appeal for the release of detained American pastor Andrew Brunson. The lira, already lower in the session, weakened further.
“The situation in Turkey is troubling and until the rhetoric in the back-and-forth calms down it’ll be on the forefront of investors minds,” said Andre Bakhos, managing director at New Vines Capital LLC in Bernardsville, New Jersey. “People will remove equity exposure amid the uncertainty especially given Turkey’s public holidays next week.” At 9:56 a.m. EDT the Dow Jones Industrial Average.DJI was down 1.73 points, or 0.01 percent, at 25,557.00, the S&P 500.SPX was down 2.04 points, or 0.07 percent, at 2,838.65 and the Nasdaq Composite.IXIC was down 28.91 points, or 0.37 percent, at 7,777.62.
Deere (DE.N) fell 1.8 percent after the tractor maker’s third-quarter profit missed analysts’ expectations due to higher raw material and freight costs.
Nordstrom (JWN.N) jumped 9.2 percent, the most on the S&P index, as the department store chain’s quarterly same-store sales growth beat estimates, lifting stocks of other retailers.
Second-quarter earnings have been stronger than expected, with 79.3 percent of the 463 S&P 500 that have reported so far beating analyst expectations, according to Thomson Reuters I/B/E/S.
The S&P index recorded 19 new 52-week highs and two new lows, while the Nasdaq recorded 24 new highs and 27 new lows.
Advancing issues outnumbered decliners by a 1.12-to-1 ratio on the NYSE. Declining issues outnumbered advancers for a 1.41-to-1 ratio on the Nasdaq.