US STOCKS-Futures mixed as chip equipment, auto stocks decline; rate-pause hopes support sentiment

Reuters · 09/15/2023 10:11
US STOCKS-Futures mixed as chip equipment, auto stocks decline; rate-pause hopes support sentiment

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Futures: Dow up 0.24%, S&P up 0.12%, Nasdaq down 0.07%

- Wall Street index futures were mixed on Friday as shares of Ford and General Motors as well as chip-equipment makers declined in premarket trading, while investors remained optimistic about a likely pause in U.S. interest-rate hikes.

Applied Materials AMAT.O, Lam Research LRCX.O and KLA Corp KLAC.O dropped over 2% each after Reuters reported Taiwan's TSMC 2330.TW, the world's top chipmaker, had asked vendors to delay delivery of high-end chipmaking equipment, weighing down Nasdaq futures.

Automakers Ford Motor F.N and General Motors GM.N shed 2% each before the bell after the United Auto Workers union launched simultaneous strikes at three factories owned by the "Detroit Three", including Chrysler-owner Stellantis STLAM.MI, marking the most ambitious U.S. industrial labor action in decades.

SoftBank's Arm Holdings ARM.O gained 8.7% in premarket trading after a stellar Nasdaq debut on Thursday, rekindling hopes of a turnaround in the initial public offering (IPO) market.

"Move aside Nvidia, there's a player in town and its is Arm," said Russ Mould, investment director at AJ Bell.

"When a stock goes up 25% in a day, there will be FOMO among investors – fear of missing out. That might explain why its shares look like they will jump again today."

Arm's successful premiere has prompted grocery-delivery company Instacart to raise its IPO target price, according to a report.

Investors are also focused on Neumora Therapeutics' NMRA.O debut later in the day after the SoftBank-backed firm raised $250 mln in its U.S. IPO.

Wall Street's main indexes gained on Thursday after hotter-than-expected economic data eased worries about a recession without raising fears of a U.S. interest rate hike week.

Traders see a 97% chance of the Federal Reserve holding rates steady in its Sept. 20 policy meeting and a 65% likelihood of a pause in November, according to the CME FedWatch Tool.

Investors will monitor August industrial production and the University of Michigan's preliminary reading of consumer sentiment due later in the day.

Upbeat data on China's factory output and retail sales in August bolstered market sentiment, as it suggested that a flurry of recent measures to shore up the world's second largest economy were starting to bear fruit.

U.S.-listed shares of Alibaba Group Holdings BABA.K, JD.O, PDD Holdings PDD.O and Xpeng XPEV.N rose between 0.1% and 0.5%.

At 5:41 a.m. ET, Dow e-minis 1YMcv1 were up 85 points, or 0.24%, S&P 500 e-minis EScv1 were up 5.25 points, or 0.12%, while Nasdaq 100 e-minis NQcv1 were down 11.75 points, or 0.07%.

(Reporting by Ankika Biswas in Bengaluru
Editing by Vinay Dwivedi)