- Shares of major semiconductor firms including Intel and Broadcom opened lower amid AI profit doubts
- US stock indexes fell with Nasdaq down 0.47%, S&P 500 down 0.38%, and Dow Jones down 0.33% by 7 pm IST
- Rising US treasury yields and oil prices, with WTI up 4.45%, contributed to the negative market sentiment
Shares of semiconductor stocks such as Intel, Broadcom, SanDisk, Qualcomm, AMD, Micron, Nvidia and SK Hynix all opened in red, with Intel's stock falling as much as 3.06% at the opening bell on Thursday. This development takes place amid elevated investor scepticism regarding near-term profitability of AI technology, leading to a broader selloff.
The US stock market also opened lower due to rising US treasury yields, oil prices rallying nearly 5% and the anticipation of the Federal Reserve raising interest rates.
ALSO READ: Classic Bubble': Billionaire Ray Dalio Warns AI Rally Nearing Its Breaking Point
The Nasdaq Composite fell 0.47% to 27,410.59, S&P 500 slid 0.38% to 7,772.41, while Dow Jones Industrial Average traded 0.33% lower at 51,009.78 by 7 pm IST.
Intel commenced trade at a downturn of 3.06% to $109.66 apiece, while Broadcom saw a decline of 1.77% to $369.83 after markets opened. Qualcomm was at a downturn of 1.66% to trade at $174.19, minutes into trade, while AMD opened 1.66% lower to $635.15. SanDisk started the trading session at a downturn of 1.40% to $1,668.79.
SK Hynix saw a decline of 0.73% to $176.95 after the opening bell, while Nvidia Corp. opened at a downturn of 1.19% to $234.64. Micron's shares fell 0.55% after the markets opened to $1,082.06.
The West Texas Intermediate (WTI) futures were trading at an uptick of 4.45% to $92.21 dollars per barrel at 7:28 p.m. IST. Brent crude oil futures were up 4.34% at $105.55 per barrel at 7:28 p.m. IST.
This development comes three days after the Nasdaq had closed with a fresh high in the previous day's trade up 1.05% to 27,544.07.
ALSO READ: US Stock Market Today: Dow, S&P 500, Nasdaq In Red As Oil, Treasury Yields Jump
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 endeavours at the Forbes Global CEO Conference in Singapore on Wednesday.
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