Summary
- US stocks ended mixed, with the Nasdaq Composite and the S&P 500 closing lower while the Dow finished higher after a sharp drop in semiconductor stocks.
- The plunge in the Philadelphia Semiconductor Index and chipmakers including Micron Technology, Intel and AMD reflected a reversal of the options-market gamma squeeze, the report said.
- SpaceX, which listed last week, extended its rally to a third straight session, lifting its market capitalization to about $2.6 trillion and making it the world's fifth-largest company by market value.
Forecast Trend Report by Period
Major US stock indexes ended mixed on Wall Street. The tech-heavy Nasdaq Composite fell more than 1% as semiconductor shares sank, while the blue-chip Dow Jones Industrial Average rose on lower oil prices and Treasury yields.
On June 16, the Dow rose 328.64 points, or 0.64%, to 51,999.67. The S&P 500 fell 42.94 points, or 0.57%, to 7,511.35. The Nasdaq dropped 307.60 points, or 1.15%, to 26,376.34.
The Dow closed at a record high. Optimism persisted after the United States and Iran reached an agreement to end the war, sending crude prices sharply lower.
Technology stocks were the main drag. They traded around flat early in the session before losses deepened. The Philadelphia Semiconductor Index tumbled 5.71%. Micron Technology fell 6.22%, Sandisk lost 5.52%, Intel dropped 8.45%, Marvell slid 9.92% and AMD sank 7.30%.
Chip stocks had been extending a recent rally and surged a day earlier on enthusiasm over the US-Iran ceasefire news. Investors who had expected the talks to run into trouble rushed to unwind derivatives positions betting on weakness in equities, magnifying the market's upside swings.
That derivatives-fueled rally reversed on June 16, according to market commentary. Seo Sang-young, a managing director at Mirae Asset Securities, said the selloff centered on semiconductor shares reflected a reversal of the options-market gamma squeeze that had driven the previous day's sharp gains.
SpaceX, which listed last week, rose 4.83%, extending its rally to a third straight session since the debut. The gain lifted its market capitalization to about $2.6 trillion, pushing it past Amazon to become the world's fifth-largest company by market value. It briefly overtook Microsoft during the session.
Investors are now focused on the Federal Reserve's policy meeting on June 17. It will be the first Federal Open Market Committee meeting chaired by new Fed Chair Kevin Warsh. The benchmark rate is widely expected to remain unchanged, but traders are closely watching Warsh's remarks at his first post-meeting press conference.
According to CME Group's FedWatch tool, interest-rate futures markets are pricing in a 40% chance that the Fed will hold rates steady through December and a 60% chance of at least one rate increase by then.
Han Kyung-woo, Hankyung.com reporter case@hankyung.com
Korea Economic Daily
hankyung@bloomingbit.ioThe Korea Economic Daily Global is a digital media where latest news on Korean companies, industries, and financial markets.
