Chip Stocks Pull US Futures; Stoxx Gains 600: Wrapping the Markets

(Bloomberg) — Major US chipmakers fell sharply in pre-market trading on a report that lawmakers in Washington are considering new restrictions on chip sales to China.

Most Read from Bloomberg

Nvidia Corp. and Advanced Micro Devices Inc. sank. by more than 3%, while Nasdaq 100 futures fell 0.5%. The Wall Street Journal reported late Tuesday that lawmakers have discussed stopping some sales of artificial intelligence chips to China, which could lead to more tensions between the two countries.

Timothy Graf, head of EMEA strategy at State Street Bank, said that while the tougher action from Washington would be a setback for chipmakers, such as Nvidia, it is unlikely to significantly dampen appetite for stocks, which have soared on the back of a craze. artificial intelligence. Trust Company

“It’s a small pullback in what was a triple-digit move for some stocks,” he said.

Elsewhere, stock markets were broadly higher, catching up to yesterday’s technology-led rally in the US. The European Stoxx 600 rose 0.5% and Japan’s Nikkei 225 jumped 2%.

Among individual carriers, UBS Group AG has stepped forward as the company prepares to cut more than half of Credit Suisse Group AG’s workforce. Shares of beleaguered Swedish owner SBB AB rose after analysts at Goldman Sachs Group Inc. their recommendations on the stock.

The bonds of Thames Water, Britain’s largest water supplier, plunged, with one of its banknotes dropping 35p to the pound. The facility is in talks with officials about contingency plans including temporary nationalization as concerns grow about its debts of more than 13 billion pounds ($16.5 billion), according to people familiar with the matter.

Story continues

Dive buyers are hard to find this time: evaluation

Investors are also awaiting news from a central banking forum in Portugal, where the European Central Bank’s Christine Lagarde, the Federal Reserve’s Jerome Powell, the Bank of Japan’s Kazuo Ueda and the Bank of England’s Andrew Bailey are scheduled to speak later today.

Treasury yields were broadly lower, however resilient US economic data underlined the potential for the Fed to tighten monetary policy further. Lagarde and many other policy makers also stressed that the ECB will continue to raise interest rates.

Are they going to stop or won’t they stop? Are we going to see a recession and when?

The Fed is also expected today to release the results of its annual stress test for the banking sector. Analysts largely expect banks to sail, even as regulators explore tougher requirements in the wake of some meltdowns in the financial industry.

Main events this week:

• US Wholesale Inventories, Merchandise Trade Balance, Wed

• The Federal Reserve released the results of its annual stress test for the banking industry, Wednesday

• Policy Committee with Christine Lagarde of the European Central Bank, Federal Reserve Chairman Jerome Powell, Kazuo Ueda of the Bank of Japan and Andrew Bailey of the Bank of England, Wednesday

• Eurozone Economic Confidence, Consumer Confidence, Thursday

• US GDP, Initial Jobless Claims, Thursday

• Atlanta Federal Reserve Chairman Raphael Bostick speaking Thursday

• China Manufacturing PMI, Non-Manufacturing PMI, Balance of Payments, Friday

• US Personal Income and Spending, University of Michigan Consumer Confidence, Fri

Some of the major movements in the markets:

Stores

• S&P 500 futures were down 0.2% as of 5:12 a.m. New York time.

• The Nasdaq 100 fell 0.5%.

• Futures contracts on the Dow Jones Industrial Average changed little

• Stoxx Europe 600 rose 0.5%

• The MSCI World Index rose 0.2%.

currencies

• The Bloomberg Spot Dollar Index rose 0.2%.

• The euro was little changed at $1.0956

• The British pound fell 0.3 percent to $1.2710

• The Japanese yen was little changed at 144.01 per dollar

• The offshore yuan fell 0.4 percent to 7.2533 per dollar

Digital currencies

• Bitcoin fell 1.3 percent to $30,251.99

• Ether fell 1.8% to $1,858.05

bonds

• The yield on the 10-year Treasury fell 2 basis points to 3.74%.

• Germany’s 10-year yield fell 2 basis points to 2.33%.

• The UK 10-year yield fell three basis points to 4.34%.

goods

• West Texas Intermediate crude fell 0.5 percent to $67.39 a barrel

• Gold futures fell 0.2 percent to $1,919 an ounce

This story was produced with help from Bloomberg Automation.

— with assistance from Charlotte Yang, Amia Carvey, and Allegra Catelli.

Most Read from Bloomberg Businessweek

© 2023 Bloomberg LP