Oct 8 (Reuters) – US stock index futures fell on Thursday, pressured by inflation concerns as oil jumped nearly 4% and Treasury yields rose, while chipmakers faced renewed scrutiny despite a strong forecast from Samsung.
South Korea’s Samsung Electronics forecast a record quarterly profit of $80.2 billion, above analysts’ estimates, but its shares closed marginally lower.
The results did not rally global chip stocks, however, highlighting doubts about the AI boom. Nvidia dipped 0.6% in premarket trading, Broadcom eased 1.4% and Micron Technology fell 1.2%.
Meanwhile, the Wall Street Journal reported on Wednesday that Broadcom is lining up $50 billion of financing for OpenAI, with Oracle also seeking an unspecified sum, spurring fears that massive debt issuance by technology companies could intensify the competition for capital.
A rebound in Treasury yields and oil prices knocked the S&P 500 and Nasdaq from record highs a day earlier, while the Dow snapped a four-day winning streak.
The weak sentiment persisted on Thursday, with Brent crude jumping over 4% on the back of attacks on shipping in the Gulf and the Strait of Hormuz, while the US cut output as a hurricane menaced offshore production. [O/R]
Renewed inflation worries pushed Treasury yields higher, with the benchmark 10-year yield climbing to 5.34%, though it remained below earlier session highs.
At 06:14 a.m. ET, Dow E-minis fell 399 points, or 0.78%, S&P 500 E-minis lost 31.5 points, or 0.4%, and Nasdaq 100 E-minis shed 180.25 points, or 0.57%.
US Federal Reserve Governor Christopher Waller hinted at a possible pause at the central bank’s upcoming meeting. Additional rate hikes would likely be needed to lower inflation to the Fed’s 2% target, but there was “flexibility” about the pace of increases, he said earlier in the day.
Traders widely expect the Fed to hold rates steady at its October meeting, but a December hike remains on the cards, according to CME FedWatch.
Wolfspeed was an outlier among chipmakers, soaring 16.6% after it received a $1.5 billion conditional loan commitment from the US Department of Defense to expand the domestic production of silicon carbide materials and power devices.
Applied Digital rose 3.5% after the data center provider’s first-quarter revenue more than quadrupled to $341.9 million.
(Reporting by Tharuniyaa Lakshmi in Bengaluru; Editing by Pooja Desai)
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