Dow Jones futures rose slightly late Tuesday, along with S&P 500 futures and Nasdaq futures. Salesforce.com (CRM) jumped after hours on strong earnings, signaling a move back above a buy point. Meanwhile, even as the Dow Jones, S&P 500 index and Nasdaq composite suffered significantly losses Tuesday, the critical semiconductor sector held up well. Micron Technology (MU) rallied, briefly breaking out past a buy point. Intel (INTC) and Nvidia (NVDA) barely fell, holding solidly in buy range.
Dow Jones Futures Today
Dow Jones futures and S&P 500 futures rose 0.1% vs. fair value. Nasdaq 100 futures edged up 0.1% vs. fair value.
Salesforce.com
Salesforce earnings rose 85% per share vs. a year earlier, much better than expected. Revenue grew 25% to $3.01 billion. Salesforce stock rose 4.7% late to 132.80. That signals a move back above a 128.97 flat-base buy point initially cleared on May 10.
Dow Jones Led Tuesday Sell-Off
With tumbling bond yields and other bad news slamming bank stocks, falling crude prices hitting energy stocks and Disney (DIS) facing a pair of negative headlines, it’s no wonder that the Dow Jones fell hardest Tuesday, losing 1.6%. The Dow Jones also undercut its 50-day moving average slightly. The S&P 500 index lost 1.2%, while the Nasdaq composite slipped just 0.5%.
Micron, Intel, Nvidia Are Chip Standouts
Micron Technology was the clear sector standout, rising 2.1% to 62.62. Intraday, Micron stock hit 63.98, clearing a 63.52 cup-base buy point. Shares have skyrocketed 36% so far in May. The month has included a 15% spike last week on raised guidance, a $10 billion stock buyback and the release of a flash memory chip with Intel. Micron’s relative strength line, which tracks a stock’s performance vs. the S&P 500 index, hit a new high.
Intel dipped 0.2% to 55.32, but the world’s largest chipmaker is still holding above a flat-base entry of 53.88. Intel’s chart is extremely messy, which is not great news. But its RS line continues to march higher, hitting a new peak Tuesday.
Nvidia slid 0.3% to 248.59, comfortably above a 239.35 buy point from a shallow double-bottom base.
Why Chips Matter
Semiconductors are a key part of the major stock market indexes, especially the Nasdaq composite. But chips are in so many products, from new cars to the Apple (AAPL) iPhone. If chip stocks and chipmakers are faring well, that’s a good sign for other tech sectors.
Bottom line: It’s very hard for the stock market to have a sustained advance without the active participation of the chip sector.
