LDN - Business

Nasdaq futures fall 1 percent as Nvidia takes down chipmakers

[November 16, 2018] By Sruthi Shankar

(Reuters) - Nasdaq futures fell more than 1 percent on Friday, as disappointing forecasts from chip companies Nvidia and Applied Materials battered the technology sector and fueled further worries about a chip boom that maybe grinding to a halt.

Nvidia Corp <NVDA.O> shares fell 17.8 percent in premarket trading after the chip designer blamed unsold chips piling up as the cryptocurrency mining boom fizzles out.

Rival Advanced Micro Devices Inc <AMD.O> dropped 5.9 percent and Micron Technology Inc <MU.O>, which sells memory to Nvidia for its gaming cards, declined 3.9 percent.

Results for Applied Materials Inc <AMAT.O>, seen as a barometer for the chip equipment maker industry, also discouraged investors after its disappointing forecast. Its shares fell 9 percent.

The weakness is likely to add to this week's pain for technology stocks <.SPLRCT>, down more than 2.4 percent, amid concerns about softening demand for iPhones, tighter regulation and a weakening chip sector.

The Philadelphia Semiconductor index <.SOX> after gaining more than 35 percent each in 2016 and 2017, is down about 1.5 percent this year.

At 7:25 a.m. ET, Dow e-minis <1YMc1> were down 151 points, or 0.6 percent. S&P 500 e-minis <ESc1> were down 19 points, or 0.69 percent and Nasdaq 100 e-minis <NQc1> were down 87.5 points, or 1.27 percent.

The S&P 500 snapped a five-day losing streak on Thursday, helped by a report that said Washington would pause further tariffs on Chinese imports.

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Traders work on the floor at the New York Stock Exchange (NYSE) in New York City, U.S., November 12, 2018. REUTERS/Brendan McDermid

The hopes of a trade deal were dampened following a Reuters report on Thursday that suggested a breakthrough was unlikely at expected talks between Presidents Donald Trump and Xi Jinping at the sidelines of a G20 summit in Argentina later this month.

European markets tried to stabilize as British Prime Minister Theresa May fought for survival after a draft divorce deal with the European Union provoked the resignations of senior ministers and mutiny in her party.

Nordstrom Inc <JWN.N> fell 10.3 percent as the department store operator's third-quarter same-store sales disappointed and the company took charges from a credit card problem.

Viacom Inc <VIAB.O> rose 4 percent after the company reported a 5 percent rise in quarterly revenue, as its Paramount Pictures division gained from the success of "Mission: Impossible - Fallout".

PG&E Corp <PCG.N> gained 40.9 percent, after six straight days of losses after a Bloomberg report on a regulatory official saying it does not want the utility to go into bankruptcy should it be found responsible for the deadly wildfires in northern California.

(Reporting by Sruthi Shankar in Bengaluru; Editing by Shounak Dasgupta)

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