Equities: Chip-led drag as semiconductors slide – Deutsche Bank

Deutsche Bank strategists highlight that the S&P 500 was marginally lower as semiconductor weakness weighed on equities. Chip and data‑center names extended their recent declines, with the Philly semiconductor index posting a fifth consecutive drop. Jim Reid’s team stresses that semiconductors represent over a sixth of the S&P 500, amplifying sector‑specific moves into the broader index.

Semiconductor slump pressures index

"As all that was going on, it wasn’t the best day for equities either, as AI concerns meant there was a fresh drag from chip stocks and data centers. While chips are just one sector, semiconductors and semiconductor equipment make up over a sixth of the S&P 500, so what happens there can easily drive the overall index."

"And that was clear once again yesterday, as the Philly semiconductor index (-0.23%) posted a 5th consecutive decline for the first time since July. So that exerted a drag on the overall S&P 500, which was just worse than unchanged (-0.02%) on the day, whilst Europe’s STOXX 600 also fell -0.10%."

"Asian equity markets are mostly trading higher this morning as semiconductor stocks rebound from the recent selloff, though rising oil prices are capping gains. Across the region, South Korea’s KOSPI (+1.13%) is leading advances, supported by a recovery in chipmakers. Japan’s Nikkei (+0.89%) is also posting solid gains, while Hong Kong’s Hang Seng (+0.16%) is modestly higher."

"In contrast, Australia’s S&P/ASX 200 (-0.66%) is under pressure, and China’s CSI 300 (-0.31%) is lagging regional peers. Meanwhile, the Shanghai Composite (+0.01%) is hovering around flat levels. S&P 500 (+0.22%), Nasdaq 100 (+0.24%) and Stoxx (+0.34%) futures are higher. "

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)