US stocks today: US stocks end lower for the day and week as chip selloff broadens
Wall Street extended its decline on Friday as a pullback on stocks associated with the AI boom, which has driven many of the gains so
Wall Street extended its decline on Friday as a pullback on stocks associated with the AI boom, which has driven many of the gains so far this year, morphed into a larger risk-off sentiment.Semiconductor shares, which have led the broader market's move in recent sessions, initially led the selloff, which broadened as the session progressed.All three major U.S. stock indexes closed lower on the day and posted weekly losses.The Philadelphia SE Semiconductor Index logged its steepest weekly loss in over a year, and has tumbled nearly 18% so far in July. Even so, the index remains up about 65% year-to-date, compared with the S&P 500's nearly 9% gain over the same time frame. Some investors in the artificial intelligence space have begun positioning for a slowdown in the nearly trillion-dollar spending boom, with some active managers already scaling back their exposure, according to a Reuters analysis."It's like the market has chip fatigue," said Ryan Detrick, chief market strategist at Carson Group in Omaha, Nebraska.
"Chip stocks are down three of the last four weeks, and it's the same worries, the same concerns; those stocks got way ahead of themselves, and now they're coming back to Earth."According to preliminary data, the S&P 500 lost 75.99 points, or 1.01%, to end at 7,457.78 points, while the Nasdaq Composite lost 370.83 points, or 1.40%, to 25,511.12. The Dow Jones Industrial Average fell 394.01 points, or 0.75%, to 52,158.96. Among the major sectors of the S&P 500, energy stocks were the biggest gainers, benefiting from spiking crude prices amid signs of escalating hostilities in the Iran war.Q2 EARNINGS SEASON GETS OFF TO AN UPBEAT STARTSecond-quarter earnings season is still in its early days, with 49 of the companies in the S&P 500 having reported.
Of those, 90% have delivered better-than-expected results, according to LSEG.Analysts now see year-on-year S&P 500 earnings growth of 26.0%, in aggregate, up from the 19.2% expectations as of April 1, per LSEG."It's early in earnings season, but we're off to a tremendous start," Detrick added. "Over the next several weeks, we're going to get a lot more sectors and industries reporting. But so far, the banks have really started us off on the right foot." Netflix tumbled after the company's weaker-than-expected earnings forecast, raising doubts about the sustainability of the content growth momentum. Uber Technologies dropped after the rideshare app announced it would acquire Germany's Delivery Hero in a deal worth nearly $15 billion.
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