Shares of semiconductor stocks such as Micron, SK Hynix, SanDisk Corp., Advanced Micro Devices (AMD) and Nvidia fell as much as 3% after the opening bell of the US stock market, amid rising 10-Year bond yields and oil prices.
Micron commenced trade at a downturn of 3.25% to $1011.61 apiece, while SK Hynix saw a decline of 2.18% to $178.59 after markets opened. AMD was at a downturn of 0.91% to trade at $643.50, minutes into trade, while SanDisk opened 1.26% lower to $1,639.57. Nvidia started the trading session at a downturn of 0.67% to $237.65.
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Intel bucked the wider trend trading higher at an uptick of 1.51% to $114.20 after the opening bell.
The US Treasury note yield and was at its highest level in 24 years climbing eight basis points 5.356%, while the 30-year bond yield went up eight basis points to 5.725%, its highest level since May 2002.
The West Texas Intermediate (WTI) futures were trading at an uptick of 1.69% to $90.95 dollars per barrel at 7:08 p.m. IST. Brent crude oil futures were up 1.86% at $102.45 per barrel at 7:09 p.m. IST.
The US stock market opened in red on Wednesday, October 7 after the S&P 500 hit a fresh all-time high in the previous session as oil prices and Treasury yields jumped.
Nasdaq Composite dropped 0.54% to 27,451.32, S&P 500 declined 0.40% to 7,787.71, while Dow Jones Industrial Average traded 0.67% or 347 points lower at 51,173.8 at 7 pm IST.
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This development comes two days after the Nasdaq had closed with a fresh high in the previous day's trade up 1.05% to 27,544.07.
Other factors affecting the decline in semiconductor share price include investor caution with regards to the cyclical peak in memory pricing. Prominent names in the investing space such as Ray Dalio predicted that the AI industry is nearing a "classic bubble" which is close to bursting. This is due to climbing interest rates and the need for liquidity.
Dalio noted that a large amount of debt was being taken out to fund AI endeavoursat the Forbes Global CEO Conference in Singapore on Wednesday.
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