TSMC Weakens, Nasdaq Also Under Pressure
Wall Street weakened on Thursday (July 16th) after pressure on Taiwan Semiconductor shares dragged down the chip sector. The S&P 500 index fell 0.3%, while the Nasdaq Composite weakened 0.9%. The Dow Jones Industrial Average also fell slightly, 20 points, or 0.1%.
The main pressure came from Taiwan Semiconductor shares, which fell 2%. Although the company's second-quarter report was better than expected, investors were more focused on the increase in capital expenditure projections. TSMC now estimates capital expenditure this year to be in the range of US$60 billion to US$64 billion, up from its previous guidance of US$52 billion to US$56 billion.
The semiconductor sector also suffered. The VanEck Semiconductor ETF fell more than 2%, led by the decline in Arm Holdings, which plunged more than 6%. Shares of Micron Technology and Advanced Micro Devices each fell more than 3%, while Broadcom fell more than 2%. US-listed shares of SK Hynix also plunged more than 6%.
However, the Dow's decline was offset by UnitedHealth's more than 6% rise after posting better-than-expected earnings. UnitedHealth's positive performance helped cushion the downward pressure on the blue-chip stock index.
Wall Street had previously rallied after lower-than-expected US PPI data reinforced hopes that inflation was cooling. However, pressure on chip stocks indicated investors remained sensitive to technology valuations, AI capital spending, and the margin outlook for semiconductor companies.
As a result, pressure in the chip sector could limit the short-term rally in tech stocks. While tamer inflation and lower yields remain positive sentiment, the market still needs confirmation from the next major company earnings reports to maintain Wall Street's momentum. (arl)
Source: Newsmaker.id
