(Bloomberg) — US stock futures slipped after Nvidia Corp. gave a revenue forecast that fell wanting the very best analyst estimates, possibly adding weight to concerns over the sustainability of the factitious intelligence boom.
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Futures on the Nasdaq 100 Index were down 0.6% as of 12:34 p.m. in Hong Kong on Thursday while contracts on the S&P 500 Index fell 0.3%, each paring earlier losses. Semiconductor-related stocks dragged a key Asian equity benchmark lower.
Despite a recent recovery, the Nasdaq 100 continues to be down from its record high as investors attempt to gauge whether this yr’s massive rally in AI stocks has gotten too far ahead of the profits the technology will actually deliver. At the identical time, expectations for rate of interest cuts have helped spur some rotation out of tech and into sectors that had been lagging.
Nvidia’s shares slumped greater than 8% in post-market trading, with the corporate’s announcement of production snags with its latest Blackwell chips also weighing on sentiment.
The market could also be disenchanted that the chipmaker’s results weren’t as stellar as prior reports, but “this looks as if just near-term noise” amid continued underlying strength, Adam Crisafulli of Vital Knowledge wrote in a note. Slower growth is “only a function of extremely difficult comparisons, and it’s something the entire world has been aware of.”
Declines in US stocks Wednesday ahead of Nvidia’s report show investors were on alert for negative surprises. Futures coming off their intraday lows could indicate that an extra drop will likely be limited by continued optimism for the chipmaker’s outlook.
Nvidia management’s assurance that it expects the Blackwell chip to herald “several billion dollars” of revenue within the fourth quarter “was necessary and may dispel most worst-case-scenario bear talking points,” TD Cowen analyst Matthew Ramsay wrote in a note. “But formal guidance for the January quarter is probably going required before the controversy is actually put to rest.”
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