S&P 500 Futures: Can Stocks Advance If The Chips Are Down? | Stock News & Stock Market Analysis

Futures for the S&P 500 index edged lower in late trading Monday. For a second straight session, the S&P 500 retreated despite as top techs such as chip stocks such as Nvidia (NVDA), Micron Technology (MU), ASML (ASML), Applied Materials (AMAT) and Lam Research (LRCX) crashing through key support in recent days, with the Philadelphia Semiconductor Index tumbling through its 50-day line on Monday.

X Losses by chips and leading techs such as Facebook (FB), Adobe Systems (ADBE) and Microsoft (MSFT) offset gains by financials, retailers, transports and media companies.

It’s hard for the market to advance without the chip sector. Not only are key parts of the Nasdaq composite and S&P 500 index, but they are involved in so many other tech fields. Nvidia is a great example with its graphics chips and cards expanding from PC gaming fields to autonomous driving, artificial intelligence and even Bitcoin mining.

S&P 500 index futures were a fraction below fair value. Dow industrial futures climbed 0.15% after blue chips added 0.2% in Monday’s stock market trading. Nasdaq 100 futures were flat after the composite closed down 1.1%.


Nvidia tried to retake its 50-day moving average on Monday, but reversed hard to close down 5.6% to 186.66, nearly 15% off its Nov. 20 peak. The recent heavy-volume retreat suggests investors may consider taking profits in the highflier. The stock is still slightly extended from a 174.66 buy point, but don’t let a 10%+ gain turn into nothing or a loss.

Micron Technology

Micron Technology has fallen for six straight sessions, starting when Morgan Stanley predicted that memory chip prices will fall. Micron fell below its 50-day line last Thursday and found resistance at the level the past two sessions.

ASML, Applied Materials, Lam Research

Chip-equipment makers ASML, Applied Materials and Lam Research plunged through their 50-day moving averages in heavy volume on Nov. 29, flashing clear sell signals. The chip-equipment makers have continued to fall since then.

ASML, Applied Materials and Lam Research have the biggest market caps among IBD’s chip-equipment group. The eight largest chip-gear firms are all below their 50-day lines.

Intel, Broadcom OK

Not every chip stock is in freefall.

Intel (INTC), the world’s largest chipmaker, has pulled back modestly in recent weeks, but remains above its 50-day moving average. Intel has expanded from chips for the PC market to data centers and, greatly aided by its Mobileye acquisition, targeting the automotive market.

Broadcom (AVGO) also has pulled back, testing a recent buy point on Monday before rebounding somewhat. But it’s in better health than most. The Apple (AAPL) chip supplier turned its unsolicited Qualcomm (QCOM) bid into a hostile effort, nominating directors to replace Qualcomm’s entire board.


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Originally posted 2017-12-05 04:37:24.


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