US Pre-Market June 26: Nasdaq Futures Fall as Memory Costs Split Big Tech

Sentiment: bearish S&P 500 futures: -0.48% Nasdaq 100 futures: -1.18%

S&P 500 futures sit 0.48% lower and Nasdaq 100 futures 1.18% lower into the Friday US open, on a memory-cost split running through big tech: hardware makers fell on rising chip costs while the memory producers that supply them rose. AAPL.US dropped 6.15% on Thursday after raising consumer-hardware prices tied to memory costs, the single largest weight on the index, while MU.US gained 15.81% on stronger-than-expected earnings. The decline deepened overnight in Asia, where South Korea's KOSPI fell 5.81% and tripped a circuit breaker after an 8% intraday drop.

Overnight drivers

• Memory cost squeeze on hardware: AAPL.US -6.15% and MSFT.US -3.45% on Thursday after both raised consumer-hardware prices to cover higher memory costs, with DELL.US -5.67%. These names carry the most weight in the 1.18% Nasdaq 100 futures decline.
• Memory producers on the other side: MU.US +15.81% on its earnings beat, SNDK.US +21.52% and WDC.US +4.81%. Higher DRAM and NAND prices that squeeze device margins lift the suppliers.
• Asia memory selloff: KOSPI -5.81%, Nikkei -4.15%, Shanghai -2.26% and Hang Seng -1.76%. The overnight drop across Korean and Japanese memory names sets up follow-through selling in US chips at the cash open.
• Crude lower: WTI -3.18% to US$69.63 and Brent -3.18% to US$73.10 as Strait of Hormuz tankers transit normally and Brent's prompt spread turns to contango, a drag on US energy names at the open.

Thursday on Wall Street

• S&P 500: 7,357.49 (-0.01%)
• Nasdaq Composite: 25,358.60 (-0.46%)
• Dow Jones: 51,920.62 (+0.14%)
• Russell 2000: 3,007.86 (+0.71%)
• VIX: 20.05 (+6.14%)

The Nasdaq extended a multi-session decline as AAPL.US -6.15%, MSFT.US -3.45%, AMZN.US -3.14% and META.US -2.68% pulled the index down, while the Dow finished higher on strength outside tech and the Russell 2000 added 0.71%. The VIX rose 6.14% to 20.05, its climb tracking the move out of the largest tech names rather than a market-wide decline.

Asia and Europe overnight

• KOSPI: 8,411.21 (-5.81%)
• Nikkei 225: 69,360.88 (-4.15%)
• Shanghai Composite: 4,027.26 (-2.26%)
• Hang Seng: 22,671.86 (-1.76%)
• STOXX 600: 633.85 (-0.99%)
• DAX: 24,693.75 (-1.20%)

South Korea led the global decline, the KOSPI down 5.81% after an 8% intraday fall triggered a trading halt, with Samsung and SK Hynix driving the move. Japan's Nikkei fell 4.15% on the same memory weakness. Europe opened lower, the STOXX 600 off 0.99% and Germany's DAX down 1.20%, following the Asian session into the US open.

Commodities and macro

• Gold: US$4,068/oz (+0.50%)
• WTI crude: US$69.63 (-3.18%)
• Brent crude: US$73.10 (-3.18%)
• US 10-year yield: 4.39% (-1 bp)
• US Dollar Index: 101.20 (-0.22%)
• Bitcoin: US$59,404 (-2.90%)

Gold added 0.50% to US$4,068 as funds rotated toward safety, while Bitcoin fell 2.90% with the risk-off tone. Crude is the largest mover on the downside, WTI off 3.18% to US$69.63 on easing Middle East supply concern and on track for a third straight weekly fall. The 10-year yield eased about 1 bp to 4.39% and the dollar slipped 0.22%, neither offering much offset to the equity decline.

What to watch into the US open

• US memory and storage names: SNDK.US +21.52% and MU.US +15.81% on Thursday now meet the overnight Asia selloff at the cash open.
• Breadth against the index: the Dow +0.14% and Russell 2000 +0.71% held up while the Nasdaq fell 0.46% on Thursday, so whether the move out of the largest tech names broadens is the session's main question.
• VIX at 20.05 after a 6.14% rise; a hold above 20 would extend this week's pickup in volatility.

US calendar today (ET)

• 10:00am ET: University of Michigan consumer sentiment, final June reading (consensus 50), plus the one-year and long-run inflation expectations.
• Fed speakers Williams and Kashkari on the rate path, after May PCE printed 4.1% year over year on Thursday, a three-year high.
• No major data scheduled otherwise; volume may thin into the weekend.

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