Morning in New York: Chipmakers Drag Stock Indices Lower

A daily review and forecast of events in the U.S. stock market by Mikhail Denislamov, Deputy Director of Freedom Capital Markets Research.

The upcoming session will take place amid a decline in the risk premium in oil prices, driven by progress in negotiations between the U.S. and Iran. U.S. authorities have issued a temporary license for the sale of Iranian oil and petroleum products, and the parties intend to establish a communication channel to ensure the safe passage of commercial vessels through the Strait of Hormuz. At the same time, Tehran has announced agreements to unfreeze $12 billion of its frozen assets, although the terms for accessing these funds have not yet been agreed upon. In the current situation, the risk of disruptions to energy supplies is decreasing, which eases inflationary concerns and supports sectors sensitive to fuel costs. At the same time, geopolitical uncertainty persists: shipping through the Strait of Hormuz is resuming unevenly, the issue of control over the strait remains unresolved, and Donald Trump’s harsh rhetoric could trigger new spikes in oil price volatility.

The U.S. market is being negatively impacted by a global correction in the technology sector, particularly in segments related to artificial intelligence and semiconductor manufacturing. Against this backdrop, South Korea’s KOSPI plummeted by about 10%, while Japan’s Nikkei 225 corrected by about 3.5%. Investors took profits following the strong rally in chipmaker stocks in recent months. In South Korea, the decline was exacerbated by warnings from regulators about the risks of leveraged exchange-traded funds, as well as by the high weighting in the index of major memory chip manufacturers Samsung Electronics and SK Hynix, whose share prices fell by more than 12%. This situation will also increase pressure on the U.S. technology sector, particularly on companies involved in artificial intelligence and semiconductors, including memory chips.

The most significant event on today’s macroeconomic calendar will be the preliminary June Purchasing Managers’ Index (PMI) data from S&P Global. The consensus forecast for the manufacturing PMI calls for a decline from 55.1 points in May to 54.6, while the services sector is expected to rise to 51.1 points from 50.7 a month earlier. Also due are the weekly ADP employment figures for June 6 (previous reading: 25,500) and the Richmond Fed’s manufacturing activity index (consensus: 8 points; May: 13).

Before the main session opens, Carnival Corporation (CCL) will report its quarterly results. After the market closes, FedEx (FDX), Cerebras Systems (CBRS), and KB Home (KBH) will release their earnings reports.

Futures on U.S. stock indices are deep in negative territory. We assess the risk balance for the upcoming session as negative, with elevated volatility. The negative backdrop is driven by the aforementioned global sell-off in tech stocks, particularly in AI- and semiconductor-related stocks. Additional pressure on prices is coming from rising Treasury yields, growing expectations of a more hawkish Fed policy, and a correction in the shares of certain megacaps.

— Avis Budget Group (CAR) shares are up more than 2% following a settlement agreement with Pentwater Capital Management. The case involves Avis’s claims against a major shareholder who, according to the plaintiff, profited from high-frequency trading in the company’s shares. Under the terms of the agreement, Pentwater must pay Avis $650 million in cash, though this requires separate court approval.

— IBM (IBM) shares are up more than 3% in response to a statement by Trump, who praised the company’s management during an official event dedicated to the prospects of quantum technology. News that IBM has joined OpenAI’s cybersecurity program—under which the company will use cutting-edge AI models to improve corporate cybersecurity solutions—provided additional support for the stock price.

— MDU Resources Group (MDU) shares are rising moderately on news that its subsidiary has entered into an agreement with Applied Digital (APLD) to supply electricity to the Polaris Forge 3 data center complex in North Dakota. At full capacity, the project could consume up to 430 MW. It is scheduled to begin operations in August 2027, subject to regulatory approval.

— Primoris Services (PRIM) shares are down more than 36% following an update to its 2026 guidance and the announcement of COO Jeremy Kinch’s resignation. The company revised its adjusted EBITDA guidance from $480–500 million to $275–325 million, and its adjusted EPS guidance from $4.80–5 to $2.05–2.6. The changes to the guidance are attributed to additional cost overruns and delays in the renewable energy segment. The company estimates that the bulk of the negative impact will be reflected in the second quarter.

— Domino’s Pizza (DPZ) shares are down about 1% following the announcement that CEO Russell Weiner is stepping down to become executive chairman. Chief Operating Officer Joe Jordan will take over on October 1.

— Pfizer (PFE) shares are down 0.25% following the release of preliminary results from a Phase III trial of sigvotatug vedotin for the treatment of non-small cell lung cancer. The drug did not demonstrate a statistically significant improvement in overall survival compared with docetaxel in the overall patient population. However, the company noted a manageable safety profile and a stronger trend toward efficacy in patients who had previously received only one line of therapy.

Trading on June 22 on U.S. stock markets ended with mixed results. The S&P 500 fell 0.37%, the Nasdaq 100 dropped 0.19%, the Dow Jones rose 0.29%, and the Russell 2000 gained 0.83%, setting a new all-time high. The indices closed above their intraday lows, but the overall picture remained mixed due to pressure on certain large technology companies and some consumer sectors.

The decline in the S&P 500 and Nasdaq was triggered by certain members of the “Magnificent Seven,” primarily Alphabet (GOOGL: −4.99% at the close of trading on June 22), whose stock plunged after reports that Google DeepMind data scientist and Nobel Prize laureate John Jumper was leaving the company to join Anthropic. The news heightened investors’ concerns about the risk of a brain drain among key artificial intelligence specialists, especially following recent reports that DeepMind researcher Noam Shazir was moving to OpenAI. The correction in the megacap segment was partially offset by gains in semiconductor and memory chip stocks. Investors continued to bet on demand from the AI infrastructure sector ahead of Micron Technology’s (MU: +6.82%) earnings report. SpaceX (SPCX: −16.43%) shares are falling deeper into the red and have already dropped more than 30% from last Wednesday’s peak.

The energy (XLE: +0.54%) and industrial (XLI: +0.49%) sectors emerged as the top performers in the broader market. Telecom stocks (XLC: −2.37%), as well as cyclical (XLY: −1.89%) and non-cyclical consumer goods (XLP: −1.34%) stocks, were among the underperformers.

Yields on U.S. Treasury bonds rose by 5–6 basis points across the curve. Investors’ focus has shifted from the oil market to indicators regarding the Fed’s interest rate, which suggest a hike of approximately 40 basis points by the end of the year. At the same time, some investment banks anticipate a more aggressive tightening of monetary policy.

— Definium Therapeutics (DFTX: +49.8% at the close of trading on June 22) presented data from the Emerge study, which met its primary endpoint. The DT120 ODT demonstrated a statistically significant and clinically meaningful improvement in depression symptoms compared to placebo at week 6 of treatment.

— Apogee Therapeutics (APGE: +46.7%) will be acquired by AbbVie (ABBV: +6.25%) by the end of the third quarter for $135.11 per share in an all-cash transaction. This values Apogee at approximately $10.9 billion, representing a premium of about 50% over its previous closing price.

— The market views the appointment of former Hynix CEO Lee Seok-hee as executive vice president of Intel’s (INTC: +5.2%) foundry division as a potential strengthening of the management team in the strategically important contract chip manufacturing business.

— AeroVironment (AVAV: −10.8%) intends to restate its quarterly financial statements for the period ended January 31 after identifying an error related to a non-cash goodwill impairment charge of $89.4 million in its space division. The error arose in connection with the termination of the BADGER/SCAR government contract. It will not affect revenue, cash flow, adjusted EBITDA, or EPS (non-GAAP).

This article was AI-translated and verified by a human editor