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Tag: VanEck Semiconductor ETF

  • CNBC Daily Open: Bullish sentiment and broadening rally – markets are in a good place

    CNBC Daily Open: Bullish sentiment and broadening rally – markets are in a good place

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    Traders work on the floor of the New York Stock Exchange on April 5, 2024.

    Spencer Platt | Getty Images News | Getty Images

    This report is from today’s CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.

    What you need to know today

    Breather from rally
    U.S. markets fell Tuesday, weighed down by a     drop in semiconductor stocks and a 8.1% slide in UnitedHealth. Asia-Pacific stocks were mostly lower Wednesday. Asian chip stocks, like Tokyo Electron and Taiwan Semiconductor Manufacturing Company, retreated on news of ASML’s disappointing forecast and reports of the U.S. possibly imposing export controls on AI chips.

    ASML slumps
    Shares of semiconductor equipment manufacturer ASML plunged 16% on a downbeat earnings report. For 2025, the Netherlands-based company thinks net sales will come in at the lower half of its previous projection. ASML missed expectations on net bookings by 3 billion euros for the September quarter, though net sales beat expectations.

    Better than ChatGPT
    Alibaba updated its artificial-intelligence translation tool, based on a model called Marco MT, on Wednesday. The Chinese e-commerce giant said its product performs better than those by Google and DeepL, according to an assessment by benchmarking tool FLoRes. Fifteen languages are supported by Alibaba’s AI-powered translation tool.

    Banks beat expectations
    Goldman Sachs, Bank of America and Citigroup beat earnings and revenue estimates for their third quarter. Goldman was the standout performer: Its profit jumped 45% from a year earlier. Year on year, Bank of America experienced a 12% drop in net income and Citigroup’s net income fell 8.6%.

    [PRO] Repositioning for slower rate cuts
    September’s strong jobs report and higher-than-expected inflation reading mean that the U.S. Federal Reserve is unlikely to repeat its jumbo 50-basis-point rate cut at its November meeting. Here’s how strategists are repositioning in view of changing rate cut expectations.

    The bottom line

    Despite markets falling Tuesday, there’s still plenty to like about their current state.

    Weighed down by ASML’s 16% dive and a report by Bloomberg on potential AI-chip export controls, semiconductor stocks like Nvidia and AMD fell 4.7% and 5.2% respectively. That gave the VanEck Semiconductor ETF its worst day since Sept. 3. As a result, the tech-heavy Nasdaq Composite lost 1.01%.

    The Dow Jones Industrial Average, which just yesterday was basking in its accomplishment at closing above the 43,000 level for the first time, fell 0.75% to dip into the 42,000 territory again. UnitedHealth’s 8.1% drop dragged down the Dow.

    Last, the S&P 500 retreated 0.76%.

    Still, investors are the most bullish in four years, according to the October BofA Global Fund Manager Survey. They’re also optimistic about the economy: 74% investors believe the U.S. will avoid a recession.

    Anticipation of more rate cuts by the U.S. Federal Reserve and hopes that Beijing will unleash more stimulus to boost its economy are driving up investor sentiment, according to Michael Hartnett, an investment strategist at BofA.

    Indeed, San Francisco Fed President Mary Daly, who’s a member of the Federal Open Market Committee this year, noted that the central bank is “a long way from where [rates are] likely to settle.” That means “the decisions that are really in front of us are ones about how quickly to adjust towards that level” – not whether to keep rates high in light of how strong recent economic data has been.

    Another positive sign for markets is how the S&P and Dow hit all-time highs on Monday, but the Nasdaq was still a few percentage points away from its peak. “This subtle divergence is technical evidence that the market has been moving away from the Magnificent Seven mega-caps,” wrote Piper Sandler’s chief market technician Craig Johnson.

    – CNBC’s Jeff Cox, Samantha Subin, Yun Li, Lisa Kailai Han and Alex Harring contributed to this story.    

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  • CNBC Daily Open: Bullish sentiment and broadening rally – plenty to like about markets

    CNBC Daily Open: Bullish sentiment and broadening rally – plenty to like about markets

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    Traders work on the floor at the New York Stock Exchange (NYSE) in New York City, U.S., May 17, 2024. 

    Brendan McDermid | Reuters

    This report is from today’s CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.

    What you need to know today

    Breather from rally
    U.S. markets fell Tuesday, weighed down by a     drop in semiconductor stocks and a 8.1% slide in UnitedHealth. The pan-European Stoxx 600 index lost 0.8% as sectors diverged in performance. Tech stocks fell 6.36%, while telecoms stocks rose 1.97%. Separately, euro zone industrial production increased 1.8% between July and August, according to Eurostat.

    Banks beat expectations
    Goldman Sachs, Bank of America and Citigroup beat earnings and revenue estimates for their third quarter. Goldman was the standout performer: Its profit jumped 45% from a year earlier. Year on year, Bank of America experienced a 12% drop in net income and Citigroup’s net income fell 8.6%.

    ASML slumps
    Shares of semiconductor equipment manufacturer ASML plunged 16% on a downbeat earnings report. For 2025, the Netherlands-based company thinks net sales will come in at the lower half of its previous projection. ASML missed expectations on net bookings by 3 billion euros for the September quarter, though net sales beat expectations.

    Israel might not hit oil facilities
    After Israel reportedly told the U.S. it’s not planning to strike Iran’s oil facilities, prices for both West Texas Intermediate and Brent futures fell more than 4%. Earlier this week, OPEC cut its forecast for daily oil demand growth in 2024 to 1.9 million barrels per day from 2 million bpd. That was the third consecutive time this year it’s lowered expectations.

    [PRO] S&P 500 at 6,400?
    Stocks seem unstoppable. Two years into a bull market, the S&P 500 has been constantly hitting new closing highs. History suggests the bull tends to stall, or at least trip on itself, in its third year. But UBS thinks the S&P can buck the trend in 2025 and soar to 6,400, implying an upside of 10% from Tuesday’s close.

    The bottom line

    Despite markets falling Tuesday, there’s still plenty to like about their current state.

    Weighed down by ASML’s 16% dive and a report by Bloomberg on potential AI-chip export controls, semiconductor stocks like Nvidia and AMD fell 4.7% and 5.2% respectively. That gave the VanEck Semiconductor ETF its worst day since Sept. 3. As a result, the tech-heavy Nasdaq Composite lost 1.01%.

    The Dow Jones Industrial Average, which just yesterday was basking in its accomplishment at closing above the 43,000 level for the first time, fell 0.75% to dip into the 42,000 territory again. UnitedHealth’s 8.1% drop dragged down the Dow.

    Last, the S&P 500 retreated 0.76%.

    Still, investors are the most bullish in four years, according to the October BofA Global Fund Manager Survey. They’re also optimistic about the economy: 74% investors believe the U.S. will avoid a recession.

    Anticipation of more rate cuts by the U.S. Federal Reserve and hopes that Beijing will unleash more stimulus to boost its economy are driving up investor sentiment, according to Michael Hartnett, an investment strategist at BofA.

    Indeed, San Francisco Fed President Mary Daly, who’s a member of the Federal Open Market Committee this year, noted that the central bank is “a long way from where [rates are] likely to settle.” That means “the decisions that are really in front of us are ones about how quickly to adjust towards that level” – not whether to keep rates high in light of how strong recent economic data has been.

    Another positive sign for markets is how the S&P and Dow hit all-time highs on Monday, but the Nasdaq was still a few percentage points away from its peak. “This subtle divergence is technical evidence that the market has been moving away from the Magnificent Seven mega-caps,” wrote Piper Sandler’s chief market technician Craig Johnson.

    – CNBC’s Jeff Cox, Samantha Subin, Yun Li, Lisa Kailai Han and Alex Harring contributed to this story.  

    Correction: An earlier version of this report misstated the day of U.S. stock movement.  

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  • CNBC Daily Open: Rate cuts might not benefit tech the most

    CNBC Daily Open: Rate cuts might not benefit tech the most

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    The sun rises behind the skyline of lower Manhattan and One World Trade Center as people walk along the Hudson River on September 14, 2024, in Jersey City, New Jersey. 

    Gary Hershorn | Corbis News | Getty Images

    This report is from today’s CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.

    What you need to know today

    Record close for Dow
    The     S&P 500 and Dow Jones Industrial Average rose on Monday, with the Dow notching a record close. But the Nasdaq Composite fell. Asia-Pacific stocks were mixed. Japan’s Nikkei 225 fell 1.03% as the Japanese yen strengthened to 140.54 against the U.S. dollar. Hong Kong’s Hang Seng index climbed 1.15% as Midea Group shares jumped over 9% in their Hong Kong debut.

    Next move for the BOJ
    The Bank of Japan won’t be raising interest rates at its September meeting, according to a CNBC survey of 32 analysts. However, the outlook for its October and December meetings is less certain. Almost 20% think an October hike is likely, while 25% said the bank’s next hike will be in December.

    India’s slowing deposit growth
    Reserve Bank of India Governor Shaktikanta Das told CNBC in an exclusive interview that slowing growth in deposits is not a cause for concern currently, and said banks are “coming out with new products for deposit mobilization.”

    Intel forges new path for foundry
    Intel shares popped around 8% in extended trading on news the chipmaker plans to structure its foundry business as an independent unit with its own board and ability to raise outside funding. It might even spin off the business as a public company, according to a person with knowledge of the matter. Separately, the Biden administration on Monday awarded Intel up to $3 billion under the CHIPS Act.

    [PRO] “Golden age of fixed income”
    The U.S. Federal Reserve is poised to cut interest rates this week. Benchmark rates affect borrowing costs. This means bond yields will go down as the Fed lowers rates. Rick Rieder, BlackRock’s global chief investment officer of fixed income, thinks now’s the time for investors to take advantage of this “golden age of fixed income.”

    The bottom line

    Technology stocks benefit the most from low interest rates, conventional market wisdom says.

    That’s because tech companies tend to promise future profit in exchange for present money. When rates are low, that proposition appears attractive because returns are low elsewhere. But when rates are high, those promises don’t seem as attractive as less risky returns from assets such as Treasurys.

    The past two years have demolished this narrative. Tech has soared even as interest rates have been at 23-year highs, thanks to enthusiasm over artificial intelligence’s promise of new and explosive revenue streams.

    Nvidia, the lynchpin of AI, has soared nearly 136% just this year. Meta, which has its own AI model named Llama, is up about 51%.

    With the market pricing in a 67% chance — up from 30% last week — that the U.S. Federal Reserve will make a larger-than-usual cut of 50 basis points, according to the CME FedWatch Tool, it stands to reason tech will pop further.

    The sector, however, has been rocky in recent weeks. The VanEck Semiconductor ETF, for instance, fell 1.31% Monday, while Nvidia slipped 1.95%.

    The tech-heavy Nasdaq Composite fell 0.52%, while the S&P 500 inched up 0.13% and the Dow Jones Industrial Average added 0.55% to close at a new record.

    This implies investors have been moving out of tech to other sectors that might experience tailwinds amid lower rates. Case in point: the financial and energy sectors rose more than 1% on Monday, performing better than the broader market.

    Goldman Sachs noted hedge funds’ weekly purchases last week of financial stocks were the highest since June 2023.

    “Other areas of the market are starting to perk up, and a lot of that has to do with the future rate cuts that are coming into play,” said Christopher Barto, senior investment analyst at Fort Pitt Capital.

    That doesn’t mean tech’s out of favor. It’s likely to continue driving the market. But other sectors might show up for the ride.

    – CNBC’s Hakyung Kim, Pia Singh and Yun Li contributed to this story.

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  • CNBC Daily Open: Tech might not be the biggest beneficiary of rate cuts

    CNBC Daily Open: Tech might not be the biggest beneficiary of rate cuts

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    The sun rises behind the skyline of lower Manhattan and One World Trade Center on September 14, 2024, in Jersey City, New Jersey. 

    Gary Hershorn | Corbis News | Getty Images

    This report is from today’s CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.

    What you need to know today

    Record close for Dow
    U.S. markets were     mixed on Monday. The S&P 500 and Dow Jones Industrial Average rose, with the Dow notching a record close. But the Nasdaq Composite fell. The pan-European Stoxx 600 index lost 0.16%. U.K.’s FTSE 100 ended flat. The Bank of England will meet Thursday for its latest monetary policy decision.

    Intel forges new path for foundry
    Intel shares popped around 8% in extended trading on news the chipmaker plans to structure its foundry business as an independent unit with its own board and ability to raise outside funding. It might even spin off the business as a public company, according to a person with knowledge of the matter. Separately, the Biden administration on Monday awarded Intel up to $3 billion under the CHIPS Act.

    Blemished Apple
    Apple shares slid 2.78% after TF Securities analyst Ming-Chi Kuo reported demand for Apple’s new iPhone 16 was down 12% year on year compared with the iPhone 15’s first-weekend sales. Kuo also said consumers weren’t enthused because Apple Intelligence wasn’t available with the iPhone at launch, and as competition from Chinese manufacturers dents iPhone demand.

    Choppy flight
    Boeing is implementing a hiring freeze amid plans to cut costs, such as pausing nonessential staff travel. Just this year, Boeing has had to deal with: a 737 MAX door panel blowing out in midair; its Starliner spacecraft returning to Earth without its two planned passengers; and a strike by more than 30,000 workers.

    [PRO] Short-lived record?
    The S&P 500 is less than 1% away from its record high set in July. The upcoming Federal Open Market Committee meeting, at which the U.S. Federal Reserve is expected to cut interest rates by at least 25 basis points, might lift the S&P to new heights. But analysts warn the new high might be short lived.

    The bottom line

    Technology stocks benefit the most from low interest rates, conventional market wisdom says.

    That’s because tech companies tend to promise future profit in exchange for present money. When rates are low, that proposition appears attractive because returns are low elsewhere. But when rates are high, those promises don’t seem as attractive as less risky returns from assets such as Treasurys.

    The past two years have demolished this narrative. Tech has soared even as interest rates have been at 23-year highs, thanks to enthusiasm over artificial intelligence’s promise of new and explosive revenue streams.

    Nvidia, the lynchpin of AI, has soared nearly 136% just this year. Meta, which has its own AI model named Llama, is up about 51%.

    With the market pricing in a 62% chance — up from 30% last week — that the U.S. Federal Reserve will make a larger-than-usual cut of 50 basis points, according to the CME FedWatch Tool, it stands to reason tech will pop further.

    The sector, however, has been rocky in recent weeks. The VanEck Semiconductor ETF, for instance, fell 1.31% Monday, while Nvidia slipped 1.95%.

    The tech-heavy Nasdaq Composite fell 0.52%, while the S&P 500 inched up 0.13% and the Dow Jones Industrial Average added 0.55% to close at a new record.

    This implies investors have been moving out of tech to other sectors that might experience tailwinds amid lower rates. Case in point: the financial and energy sectors rose more than 1% on Monday, performing better than the broader market.

    Goldman Sachs noted hedge funds’ weekly purchases last week of financial stocks were the highest since June 2023.

    “Other areas of the market are starting to perk up, and a lot of that has to do with the future rate cuts that are coming into play,” said Christopher Barto, senior investment analyst at Fort Pitt Capital.

    That doesn’t mean tech’s out of favor. It’s likely to continue driving the market. But other sectors might show up for the ride.

    – CNBC’s Hakyung Kim, Pia Singh and Yun Li contributed to this story.

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  • Citi believes this week’s chip stock drop is a buying opportunity, especially in one name

    Citi believes this week’s chip stock drop is a buying opportunity, especially in one name

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  • Wall Street could be in for another good quarter after an exuberant start to the year, history shows

    Wall Street could be in for another good quarter after an exuberant start to the year, history shows

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  • Biden’s age is figuring ‘prominently’ in the 2024 White House race — but here’s what the pundits could be getting wrong

    Biden’s age is figuring ‘prominently’ in the 2024 White House race — but here’s what the pundits could be getting wrong

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    As the 2024 race for the White House gathers steam, one topic that just won’t go away is President Joe Biden’s age.

    It comes up whenever the 80-year-old president makes a mistake such as saying “Iraq” when he means to say “Ukraine,” as occurred twice last week, or when he takes a tumble, such as his trip over a sandbag at the Air Force Academy’s commencement on June 1. Biden later joked that he “got sandbagged.”

    The…

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