June 26 - Futures tied to the tech-focused Nasdaq led early Wall Street declines as chip stocks came under fresh selling pressure following a steep rebound the day before. Memory chipmaker Micron Technology lost 4.8% in premarket trading after posting a sharp gain of more than 15% in the prior session, when the company’s upbeat quarterly outlook had buoyed technology shares globally.
Semiconductor names - a group that has been among the chief beneficiaries of the AI-related trade this year - confronted renewed turbulence after rallying earlier in the week. Traders and investors have raised questions about elevated valuations in parts of the AI complex, and some large cloud operators saw their shares slide on skepticism about how rapidly heavy data-center spending will translate into profits.
On Friday the chip segment was back under pressure. Intel and Advanced Micro Devices each slipped more than 3%, while Nvidia eased about 1.4%. Micron’s earlier surge and subsequent pullback illustrated the volatile price swings in memory and related parts of the market.
Apple was largely steady in early trading after a sharp drop of over 6% on Thursday. The prior session’s decline followed the company’s moves to raise prices on certain products, a decision executives linked to sharply higher memory and storage chip costs.
Big-cap growth names displayed a mixed pattern. Tesla and Alphabet were trading lower while Amazon.com and Microsoft were posting gains. Several software suppliers, including Salesforce, ServiceNow and Intuit, were each up roughly 1% on the session. Software stocks have felt pressure this year on concerns that AI could disrupt elements of their business models.
Investor sentiment toward tech was also affected by a report that OpenAI was weighing a delay to any public market debut until next year. "This move would be heavy with symbolism given the company essentially kicked off the whole AI theme in earnest with the launch of ChatGPT in 2022," said Danni Hewson, head of financial analysis at AJ Bell.
Shares of SpaceX, which made its market debut earlier this month, were down about 1.7% amid choppy trading. Market participants expected heavy volumes ahead of changes to the Russell indexes that include reclassifications for some megacaps and the Russell 1000’s expedited addition of SpaceX.
The benchmark S&P 500 finished flat in the previous session after losses among large technology stocks were balanced by gains in industrials, healthcare and materials. As of the last close, the S&P 500 and the tech-heavy Nasdaq were on track for significant weekly declines while the blue-chip Dow was set for modest gains.
Early electronic futures readings showed downward pressure: at 5:29 a.m. ET, Dow E-minis were down about 59 points, or 0.11%, S&P 500 E-minis were down 39.25 points, or 0.53%, and Nasdaq 100 E-minis were off roughly 343.5 points, or 1.16%.
Lingering concerns about U.S. monetary policy under a new Federal Reserve chair also played a role. Traders were pricing in a 25-basis-point hike and assigned a near-27% probability to another move by year-end, based on LSEG-compiled data. New York Fed President John Williams commented on Thursday that inflation pressures are likely to moderate this year but remain too high. Separate data released on Thursday showed U.S. inflation rose further in May.
Investors had additional economic milestones on their radar: a final June consumer sentiment reading was due later in the day, and the monthly jobs report was scheduled for the following week.
Among notable early movers, Synaptics jumped about 5.5% after ON Semiconductor said it had agreed to acquire the company in an all-stock transaction valued at about $7 billion. Footwear maker Crocs climbed roughly 1.8% after Piper Sandler upgraded the stock to "overweight" from "neutral."
Market participants monitored sector rotation and headline risk as the session progressed, with the semiconductor complex and large technology names especially sensitive to company-specific catalysts and broader macroeconomic signals.