On Monday, the S&P 500 and Nasdaq futures saw an uptick, driven by a recovery in chip stocks that had recently hit two-week lows. Notable gains were observed in shares of Nvidia, Broadcom, and Micron Technology, which rose between 1.5% and 3.9% in premarket trading. This rebound follows a significant selloff on Friday that resulted in a $1 trillion loss in market value for U.S.-listed chipmakers.
Concerns had been mounting over the rapid growth of the chip sector, especially after Broadcom’s underwhelming results last week. These concerns were compounded by expectations of tighter monetary policy. However, Mark Haefele, Chief Investment Officer at UBS Global Wealth Management, expressed confidence in the sector’s future, stating, “We do not expect investors to lose confidence in the AI outlook.” He noted that despite recent pressures, the business fundamentals remain robust.
By early morning, S&P 500 e-minis had increased by 25.75 points, or 0.35%, while Nasdaq 100 e-minis added 200.75 points, or 0.69%. Meanwhile, Dow e-minis saw a slight dip of 47 points, or 0.09%. The market’s movements were also influenced by stronger-than-expected jobs data for May, which led traders to anticipate interest rate hikes this year. According to CME Group’s Fedwatch tool, there is a 42% chance of a 25 basis point rate increase by the Federal Reserve in December.
Global Tensions and Economic Indicators
The ongoing conflict in the Middle East, particularly the renewed Israeli strikes on Iran and attacks on Lebanon, has kept investors cautious. These developments have contributed to a rise in crude prices, which surged over 4% to exceed $95 a barrel. The upcoming consumer prices report for May is expected to provide further insights into how rising energy prices are impacting inflation.
In related market movements, U.S. airline operators, including Southwest Airlines, experienced a 2.4% drop in shares due to concerns over higher fuel costs. On a positive note, Marvell Technology saw a 6.6% premarket jump as it prepares to join the benchmark S&P 500 on June 22. Additionally, Eli Lilly’s shares rose 4.1% following promising trial results for its new obesity drug, retatrutide, which also showed benefits for sleep apnea and knee pain.
Original reporting: Appleton, WI News Feed (HLL/CB) — read the source article.
