US STOCKS-Nasdaq drops as tech megacap declines outweigh upbeat chip outlook

Western Digital

Yesterday 19:45

Updates at midafternoon
Indexes: Dow up 0.41%, S&P 500 up 0.23%, Nasdaq down 0.19%
Memory chips surge as Micron results signal robust demand
Apple slips after detailing price increases 
Final Q1 GDP data comes in at 2.1%, higher than prior estimates 
By Abigail Summerville, Twesha Dikshit and Joel  Jose
June 25 (Reuters) - The Nasdaq fell on Thursday, dragged down by losses in Big Tech shares, while see-saw trade lifted the S&P 500 slightly higher in the afternoon, and a shift into other sectors lifted the Dow as investors digested new economic data.
Technology shares reversed early gains to move lower, weighing on the Nasdaq, as investors worried about hyperscaler spending on artificial intelligence and who foots the bill, fears that outweighed upbeat signals on AI demand from Micron MU.O and Qualcomm QCOM.O.
 The Nasdaq was on track for its biggest monthly decline since March 2025.
Apple AAPL.O slid 4.7% after hiking prices for iPads and MacBooks to counter surging memory and storage chip costs. Shares of Nvidia NVDA.O, Microsoft MSFT.O and Alphabet GOOGL.O were also down between 1% and 4%.
 Micron soared 17.8% after its earnings and forecasts beat Wall Street estimates. Still, concerns over debt-backed spending by hyperscalers and fears of a more hawkish Federal Reserve kept weighing on the market this week.
"The market realized that one company's blowout earnings and revenues mean someone else is paying the price for that down the line," said Carol Schleif, chief investment officer at BMO Family Office. "For Micron to generate the kinds of earnings and revenues they do, it's coming out of somebody else's hide." 
 Qualcomm rose 7.3%. Other memory chip shares also rose with Sandisk SNDK.O soaring 19.9%. Western Digital WDC.O rose 5% and Seagate Technology STX.O gained 3.2%.
Six out of 11 major S&P 500 sectors moved higher, with the industrial sector .SPLRCI leading gains with a 1.9% rise. Consumer discretionary and consumer staple stocks led the declines.
 At 2:25 p.m. ET, the Dow Jones Industrial Average .DJI rose 210.07 points, or 0.41%, to 52,058.97, the S&P 500 .SPX gained 17.23 points, or 0.23%, to 7,375.77 and the Nasdaq Composite .IXIC lost 47.33 points, or 0.19%, to 25,429.31. 
 The Philadelphia SE Semiconductor index .SOX rose 3.9% and was on track for its strongest quarter on record, according to LSEG data.
The U.S. Department of Commerce released a slew of data on Thursday.
U.S. inflation increased further in May, breaking above 4.0% for the first time in three years on higher energy prices, and potentially drawing the Federal Reserve closer to raising interest rates.
In response to rising price pressures, traders anticipate the Fed will lift interest rates by at least 25 basis points before the year-end, according to LSEG data.
A final reading of first-quarter GDP data showed the economy grew by 2.1%, compared to a prior estimate of 1.6%. Meanwhile, jobless claims data showed a higher-than-expected fall in the number of Americans filing for unemployment benefits.
"Inflation came in toasty, like people expected it to, but not super hot," Schleif said. "The suspicion is, with oil prices coming down, you'll see inflation continue to cool somewhat as we go into the summer and fall months."
 Oil prices fell below pre-war levels this week.
 Among other movers, Bio-Techne Corp TECH.O jumped 19.7% after Germany's Merck KGaA MRCG.DE agreed to acquire the biotech firm for $73 per share in cash, representing a total enterprise value of about $11.3 billion.
Advancing issues outnumbered decliners by a 1.48-to-1 ratio on the NYSE and by a 1.02-to-1 ratio on the Nasdaq.
 The S&P 500 posted 52 new 52-week highs and 15 new lows while the Nasdaq Composite recorded 201 new highs and 204 new lows.

(Reporting by Abigail Summerville in New York and Twesha Dikshit and Joel Jose in Bengaluru; Editing by David Gregorio)
((Twesha.Dikshit@thomsonreuters.com))