Traders on the floor of the New York Stock Exchange were met with a challenging market as S&P 500 futures experienced a decline following a selloff in technology stocks, marking the second consecutive day of losses for the broad index. Futures associated with the S&P 500 registered a drop of 0.23%, while the Nasdaq 100 futures fell by 0.45%. The Dow Jones Industrial Average futures lost 51 points, or 0.10%.
Both the S&P 500 and the Nasdaq Composite ended the day on a negative note, with the S&P 500 declining by 0.07% and the technology-oriented Nasdaq closing 0.51% lower. Despite the downturn in tech stocks, the blue-chip Dow managed to withstand the pressure, gaining 159.95 points, or 0.32%.
The memory chip sector was particularly affected, especially following concerning remarks from Seagate CEO Dave Mosley at a JPMorgan conference. Mosley’s comments raised alarms about the company’s ability to keep pace with an anticipated surge in demand driven by artificial intelligence innovations. He warned that constructing new factories would take too long, leading to a nearly 7% drop in Seagate’s stock. Similarly, Micron Technology faced significant losses, falling close to 6% amid concerns affecting others in the AI-related market.
These recent losses come after a period of optimism where stocks had rallied to new heights, with both the S&P 500 and the Nasdaq reaching record highs last week. The Dow even surpassed the 50,000 mark briefly. However, Kevin Gordon, the head of macro research and strategy at the Schwab Center for Financial Research, expressed skepticism about the sustainability of this momentum. He noted that, given the current market positioning and how stretched it has become, the sharp rallies seen earlier may be unlikely to persist.
In other news, developments in geopolitics briefly captured attention as President Donald Trump announced via a post on Truth Social that he was canceling a planned military action against Iran. This decision followed requests from the leaders of three regional powers in the Middle East urging him to “hold off.”
Looking ahead to the trading session, investors will be focusing on earnings reports from companies including Home Depot, Eagle Materials, and Amer Sports, all set to be released prior to the opening bell on Tuesday. Additionally, traders are awaiting the pending home sales data for April, which could further influence market sentiment.
