Selloff in semiconductor stocks causes Nasdaq to slip

The Nasdaq Composite ended Friday lower and notched its second consecutive losing week in 2023 as semiconductor stocks languished.

The tech-heavy Nasdaq slid about 0.6 per cent to end at 13,644.85, pulled down by a selloff in semiconductor stocks such as Advanced Micro Devices, Nvidia and Micron. The VanEck Semiconductor ETF (SMH) ended the week down 5.2 per cent, its worst week since October 2022.

The S&P 500 inched lower by 0.1 per cent, ending at 4,464.05. The Dow Jones Industrial Average added 105.25 points, or 0.3 per cent, closing at 35,281.40. The 30-stock index was helped by advances of 2.1 per cent and 1.8 per cent in Chevron and Merck & Co., respectively.

The S&P 500 and the Nasdaq declined about 0.3 per cent and 1.9 per cent, respectively, on the week. Both registered their second straight losing week — a first of that length for the technology-heavy Nasdaq since the conclusion of a four-week losing streak in December 2022.

The Dow is an outlier of the three major averages, advancing 0.6 per cent last week.

Elsewhere, Korean conglomerate Posco is spearheading a shift of battery material production from China to South Korea, driven by global companies' efforts to meet US tax incentives under President Biden's climate-focused Inflation Reduction Act, which encourages EV manufacturers to source components from non-Chinese suppliers, challenging Korean EV battery producers' dependence on Chinese partners for crucial minerals dominated by China's 90 per cent global production share.

Driven by robust summer air travel, higher oil consumption for power generation, and a surge in Chinese petrochemical activity, global oil demand is poised to reach a record high, projected to grow by 2.2 million barrels per day, with over 70 per cent of this growth attributed to China.

Copper prices have reached a three-month low due to China's disappointing economic indicators, including trade data and reduced new bank loans in July, leading to a slowdown in the annual growth of total social financing (TSF) to 8.9 per cent.

Overall, US sectors closed mostly higher on Friday. Energy was the best performer. Due to the selloff in semiconductor stocks, Tech was the worst performer.

Futures

The SPI futures are pointing to a 0.4 per cent fall.

Currency

One Australian dollar at 7:20 AM was buying 64.98 US cents.

Commodities

Gold shed 0.12 per cent. Silver fell 0.34 per cent. Copper lost 1.22 per cent. Oil gained 0.45 per cent.

Figures around the globe

European markets closed lower. London’s FTSE fell 1.24 per cent, Frankfurt lost 1.03 per cent, and Paris closed 1.26 per cent lower.

Turning to Asian markets, Tokyo’s Nikkei was closed, Hong Kong’s Hang Seng fell 0.9 per cent while China’s Shanghai Composite closed 2.01 per cent lower.

On Friday, the Australian sharemarket closed 0.23 per cent lower at 7340.

Ex-dividends

Euroz Hartleys Group (ASX:EZL) is paying 3.5 cents fully franked
Suncorp Group (ASX:SUN) is paying 27 cents fully franked

Dividends payable

Nickel Industries (ASX:NIC)
Mayfield Group Holdings (ASX:MYG)
Charter Hall Long WALE REIT (ASX:CLW)

Sources: Bloomberg, FactSet, IRESS, TradingView, UBS, Bourse Data, Trading Economics, CoinMarketCap.

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