The Nasdaq composite was broadly weaker Thursday after a rout in semiconductor stocks added to the week’s sell-off in the technology sector.
The Nasdaq lost 0.9% and has been down every day so far this week. The Philadelphia semiconductor index plunged 2.7% after executives from Micron Technology (MU) and KLA-Tencor (KLAC) gave cautious statements at an industry conference. Micron skidded to the lowest level since February, and KLA-Tencor fell to a nearly six-week low.
Adding to worries, a Baird analyst cut his price target on Micron to 75 from 100, and a Morgan Stanley analyst warned that memory chip markets have deteriorated.
The S&P 500 fell 0.4% as the index pared losses. Volume rose on the NYSE and fell on the Nasdaq, based on early data. Losers led winners by 12-to-7 on the Nasdaq and by about 7-to-5 on the NYSE.
Dow Again Bucks The Selling
For a second straight day, the Dow Jones industrial average bucked market weakness and posted a modest gain. The Dow climbed 0.1%. Boeing (BA), whose shares have the largest influence on the index, rose 1.3%.
Dow component Nike (NKE), embroiled in a controversy over its Colin Kaepernick commercial, rose 0.6%. Nike Shares are testing support at the 10-week moving average, attempting a rebound. But the stock remains below the 81.10 buy point of an Aug. 9 breakout to new highs.
IBD’s chip equipment industry group was near the bottom of 197 groups, down 6%. Chipmakers fell 1.7% and chip designers 1.2%. Contract electronics manufacturers, an industry with ties to the chip sector, fell 1.5%.
The energy sector also tumbled as crude oil prices slid 78 cents to $67.94 a barrel. Oil inventories fell more than expected last week, but gasoline inventories rose. Drilling, exploration & production, oil machinery, and oilfield services were groups down more than 2% Thursday.
Investors will be watching a key economic report Friday morning, when the Labor Dept. announces the jobs report for August. Economists expect nonfarm payrolls to rise by 195,000 while the jobless rate is forecast to fall from 3.9% to 3.8%.
