Most Important News

1. Samsung Profit Surges 19-Fold, Shares Plunge;
2. Goldman Sachs Highlights Shift from Chip Stocks to Cyclical Sectors;
3. SpaceX Joins Nasdaq 100 Amid Strong Wall Street Support;
4. Rivian Stock Drops 10% Amid Capital Raise Announcement;

Nasdaq-100 futures fell Tuesday, weighed down by a decline in chip stocks as investors once again appear to rotate out of names tied to artificial intelligence.

As of 03:47 PM Riyadh Time, futures tied to the tech-heavy index were down 0.99%, while S&P 500 futures lost 0.12%. Dow Jones Industrial Average futures edged higher by 225 points, or 0.42%.

Shares of Micron Technology, Inc.(MU.US) were last seen 5% lower in premarket trading, with KLA(KLAC.US), Marvell Technology(MRVL.US), Broadcom Limited(AVGO.US), and Advanced Micro Devices, Inc.(AMD.US) also posting declines.

The downward pressure began in Asia-Pacific markets after South Korea’s Kospi dropped nearly 5% following a nearly 7% drop in memory chipmaker Samsung Electronics. The company reported a big jump in second-quarter profit, though concerns about spending and demand overshadowed the increase. In Europe, the Stoxx 600 index shed 0.1%.

Subscribe to Our  The Trend Catcher Topic / The Value Anchor Topic  Topics — Stay Tuned for More Trading Opportunities

As of 03:47 PM Riyadh Time, top pre-market movements are as follows:

Ex-Fed Official Bullard Predicts Rate Hike

Former St. Louis Fed Chair Jim Bullard, now dean at Purdue University, told CNBC that despite potential inaction at the July meeting, the Fed is likely to tighten policy later this year. He cited persistently high inflation, with core inflation exceeding 3%, above the Fed's 2% target. Bullard views September as a critical window for rate hikes and doubts AI's short-term impact on monetary policy.

Samsung Profit Surges 19-Fold, Shares Plunge

Samsung's Q2 operating profit skyrocketed to KRW89.4 trillion, beating estimates, as revenue doubled to KRW171 trillion. Despite this, Samsung's stock tumbled 8%, dragging KOSPI down 6% and SK Hynix over 7%. Analysts explained that the anticipated growth triggered heavy profit-taking. Eugene Asset Management's CIO noted that despite robust earnings, the market reaction mirrored a classic sell-the-fact scenario.

Goldman Sachs Highlights Shift from Chip Stocks to Cyclical Sectors

Goldman Sachs reports that US hedge funds have been net sellers of semiconductor and hardware stocks for four weeks. To mitigate market volatility, they are purchasing broad-based index ETFs. Funds are reallocating towards defensive and cyclical sectors, increasing stakes in commercial services, consumer staples, real estate, and energy, reflecting caution in tech and a preference for sectors linked to economic cycles.

NVIDIA's Role in AI Debt Expansion

SemiAnalysis predicts AI-related debt will exceed $7 trillion by 2029. NVIDIA Corporation(NVDA.US) is leveraging its AA/Aa2 credit rating to guarantee minimum income for AI compute lessors, encouraging bank loans. This positions NVIDIA as a key lender and insurer in the AI ecosystem, taking on risks of weak downstream demand. SemiAnalysis clarified it neither endorses nor criticizes $NVDA stock, focusing solely on supply chain insights.

NVIDIA Dismisses Delay Rumors for Next-Gen AI Rack

SemiAnalysis reported a delay in the NVIDIA Corporation(NVDA.US) Rubin Ultra chip's Kyber rack architecture until 2028. NVIDIA refuted this, stating its roadmap remains intact. Taiwan suppliers confirmed that even if mass production is delayed, it won't affect NVIDIA's chip upgrades or market position. Mizuho analyst Jordan Klein noted such delay rumors are common and merely attention-seeking noise.

SpaceX Joins Nasdaq 100 Amid Strong Wall Street Support

SpaceX(SPCX.US) has been added to the Nasdaq 100, receiving unanimous "buy" ratings from major Wall Street brokers. Analysts predict up to 87% growth potential, with Morgan Stanley setting a top target of $300, compared to Monday's close at $160.42. Goldman Sachs and UBS also initiated coverage with targets of $205 and $210, respectively. SpaceX is the first aerospace-focused company in the index, with a weight of about 1.3%.

DeepSeek Develops AI Chips, Challenging NVIDIA Corporation's Market Hold

DeepSeek, a Chinese AI startup, is reportedly developing its own AI chips to support its systems, potentially reducing reliance on NVIDIA Corporation(NVDA.US). Known for its cost-effective models, DeepSeek's chip project, initiated a year ago, is in early stages with collaborations underway. If successful, this could speed up China's shift from Nvidia's supply chain, pressured by US export restrictions, increasing risks to Nvidia's Asian market share.

Rivian Stock Drops 10% Amid Capital Raise Announcement

Rivian Automotive(RIVN.US) shares fell over 10% in premarket trading after announcing a public offering of 75 million Class A shares to raise approximately $1.51 billion. The funds will support a loan agreement with the US Department of Energy. Rivian also pre-released Q2 results, projecting revenue between $1.55 billion and $1.65 billion, exceeding analyst expectations. The company’s cash reserves increased to $5.3 billion.

UBS Recommends Buying SK hynix Over Korean Shares

UBS advises clients to favor SK hynix(SKHY.US) ADR over its Korean-listed shares, citing lower holding costs and higher efficiency. The firm highlights that global fund managers previously restricted from investing in Seoul-listed stocks can now access SK hynix through US markets. UBS suggests a strategy of going long on ADRs and short on local shares, emphasizing minimal risk exposure and significant potential due to the low likelihood of ADRs trading at a discount.

Apple's Foldable iPhone Enters Production Amid Tight Supply

Reports indicate that Apple Inc.(AAPL.US)'s first foldable iPhone is advancing rapidly, with Foxconn hiring extensively in locations like Ganzhou and Shenzhen. Chinese suppliers, including Lens Technology and JINGYING Technology, are ramping up production of components like UTG covers and liquid metal hinges. Analyst Ming-Chi Kuo predicts initial supply will be extremely tight, potentially mirroring the 2017 iPhone X scenario, with shortages possibly lasting until year-end and prices doubling. These remain speculative until confirmed by Apple.

Trump Praises Walmart's Price Cuts, Urges Retailers to Follow

US President Trump commended Walmart Inc.(WMT.US) for slashing prices on select products, urging other retailers to adopt similar measures for the benefit of American consumers. He stated that Walmart's move, aligned with his administration's request, celebrates the nation's 250th anniversary. Walmart announced discounts on groceries, home essentials, and more, but did not reference Trump or the government. The company declined further comment.

BHP Group's Escondida Copper Mine Expansion Approved

BHP Group Ltd Sponsored American Depositary Receipt Repr 2 Shs(BHP.US)'s Escondida copper mine in Chile secured approval for an initial $1.3 billion expansion, paving the way for a broader $14.7 billion upgrade plan. The project aims to counter declining ore grades and meet rising copper demand from clean energy and data centers. This initiative supports $BHP's goal to double global copper output by the mid-2030s.