Semiconductor Optimism Offset by Tech Weakness and Commodity Pullback

Index Update

US equities ended mixed on Thursday as semiconductor optimism, led by Micron and Qualcomm, was offset by renewed weakness in mega-cap technology stocks. The S&P 500 was flat, the Nasdaq 100 fell 0.5%, and the Dow gained 0.1%, while stronger economic growth and in-line inflation data slightly eased Fed tightening expectations.

Market Movers

Among the top-performing stocks of the session PTL LTD surged 40.38%, while Methode Electronics, Inc. rallied 37.51%. On the losing side, Identiv, Inc. fell 32.25%, while ENDRA Life Sciences Inc. declined 31.42%, making them the weakest performers during the trading day.

Commodities Update

WTI crude fell nearly 4% to around USD 69 per barrel and Brent dropped below USD 73 per barrel on Friday, marking their lowest levels since February 27 and putting both benchmarks on track for a weekly decline of around 10%, the steepest in a month. Prices weakened as shipping through the Strait of Hormuz accelerated following progress toward a US-Iran peace deal, restoring Persian Gulf exports to roughly 75% of prewar levels. Market sentiment was further pressured by Saudi Arabia resuming tanker loadings at the Ras Tanura terminal, alongside increased supply from the UAE, Kuwait, and Qatar, while Iraq sought a higher OPEC production quota to offset wartime losses. Although a projectile strike on a container ship briefly lifted prices, confirmation that the strait remained open and exports continued uninterrupted reinforced expectations of improving global crude supply.

Gold and silver declined sharply on Friday, with gold near USD 4,000/oz and silver below USD 57/oz, tracking weekly losses of about 5% and 14%, respectively. The pullback was driven by hawkish Fed signals and rising rate-hike expectations, which outweighed modest support from in-line US PCE inflation data and easing Middle East risks as US-Iran peace progress pushed oil back toward pre-conflict levels.

Macro Updates

The dollar index steadied near 101.5 on Friday and remained on track for a weekly gain, as expectations of Fed rate hikes later this year continued to support the greenback despite in-line PCE inflation data briefly easing pressure on Thursday.

Bonds Commentary

The 10-year US Treasury yield held near 4.37% on Friday, close to seven-week lows, as in-line PCE inflation data eased fears of sharper price pressures and reduced expectations for multiple Fed hikes this year, although markets still priced high odds of rate increases in September and December amid continued hawkish Fed commentary.

Futures Update

US stock futures edged lower on Friday after mixed trading in the previous session, as weakness in megacap technology stocks outweighed optimism from Micron’s strong earnings and upbeat revenue outlook, despite sharp gains across memory-chip-related names such as Sandisk, Applied Materials, and Western Digital.

U.S. stocks delivered a mixed performance on Thursday as investors assessed a series of key economic releases alongside corporate developments, including Micron's latest earnings report. Market sentiment was also influenced by ongoing discussions surrounding U.S.-Iran peace negotiations. Despite the recent pullback, the S&P 500 continues to exhibit a constructive technical setup, trading well above both its 20-week and 50-week EMAs, which reinforces the strength of the broader uptrend. The latest weakness appears to represent a normal consolidation phase following the index's advance to record highs rather than signaling a trend reversal. Momentum indicators remain favorable, with the RSI holding above the neutral 50 mark, reflecting sustained underlying bullish sentiment. Provided the index remains above support near the 20-week EMA, short-term dips could continue to attract buying interest, supporting the broader positive outlook.