Chip stocks drag on Wall Street as inflation pressure persists
Friday's early edition: technology leads the decline, producer prices rise and Nu bucks the weaker corporate backdrop.
The S&P 500 and Nasdaq were lower as Friday trading ended, while the Dow edged higher, as a selloff in chip shares weighed on technology. A slower monthly increase in producer prices did not remove the broader inflation concern: annual producer-price growth reached 6.5%.
The end-of-session snapshot
| Index | Level | Day | As of ET |
|---|---|---|---|
| S&P 500 | 7,561.67 | -0.40% | 4:05 PM |
| Nasdaq Composite | 25,136.27 | -0.91% | 4:02 PM |
| Dow Jones | 52,348.03 | +0.10% | 4:01 PM |
1. Chip weakness spreads beyond Nvidia
AMD and Broadcom were among the sharp decliners while Nvidia also traded lower. That contrasts with Thursday's split session, when AMD and Broadcom rose despite Nvidia's fall.
Our AMD report records the earlier intraday selloff. The broad weakness shows that Friday's pressure was not confined to one stock. It does not establish that every company's orders or earnings outlook changed.
2. Slower monthly inflation, a high annual rate
The October Producer Price Index rose 0.3% from September and 6.5% from a year earlier. The monthly reading was below the 0.4% expected in market reporting, but the annual increase was the largest since November 2022.
Those figures answer different questions. Slower growth over one month does not mean producer prices fell, or that the annual inflation problem disappeared. The producer-price report has the detail.
3. Higher financing costs remain in view
The 10-year Treasury yield was 5.164% at 4:00 PM ET, up from a previous close of 5.103%. That is a timed bond-market observation, not an end-of-day fixing.
Higher yields keep the cost of funding and the value investors put on future earnings in focus. They are not themselves a new Federal Reserve interest-rate decision.
4. Nu offers a different earnings picture
Nu Holdings reported record quarterly net income of about US$1.1 billion and lowered its full-year efficiency-ratio forecast to 19% to 19.5%, from around 20%. The company's 31% year-over-year profit-growth figure is on a foreign-exchange-neutral basis.
That currency adjustment matters when comparing the release with US-dollar financial statements. Our Nu report also explains why expenses shifting into the fourth quarter qualify the lower annual cost-ratio outlook.
5. Oil is quiet on the day; drilling activity eases
January Brent settled at $95.84 a barrel, up $0.02, while December WTI settled at $88.56, down $0.18. The small daily moves contrast with Thursday's sharp rise. Today's Chain, Crude & Chips separates those oil settlements from crypto and stock observations.
The US active rig count fell by three to 601. As the rig-count report notes, that measures drilling activity, not the week's oil or gas production.
What to watch next
Monday, November 16 brings the New York Fed's Empire State Manufacturing Survey at 8:30 AM ET and its SCE Credit Access Survey at 11:00 AM ET. The first describes regional manufacturing conditions; the second addresses households' access to credit. Neither should be treated as a direct national output total.
