Wall St eyes muted open as inflation data offsets Intel's bleak forecast
By Ankika Biswas and Johann M Cherian
(Reuters) — Wall Street's main indexes were set for a subdued open on Friday as an in-line inflation print signaling continued moderation in price pressures helped offset an earnings gloom after a dour revenue forecast from Intel (NASDAQ:INTC) steered declines in chip stocks.
The U.S. Commerce Department's report showed the personal consumption expenditure index rose by 0.2% month-on-month and by 2.6% annually in December, both in line with expectations.
The core figure, excluding volatile items like food and energy — the Federal Reserve's preferred inflation gauge — rose by 0.2% on a monthly basis, while the annual 2.9% rise came in slightly below expectations of a 3% increase.
«I don't see much that would point towards a lower interest rate, but also nothing that's pointing to a higher rate, and that's good enough for now,» said Kim Forrest, chief investment officer at Bokeh Capital Partners.
Intel slumped 9.8% in premarket trading after forecasting that its first-quarter revenue could miss estimates by over $2 billion, driving losses between 0.9% and 1.5% in other chip stocks including Advanced Micro Devices (NASDAQ:AMD), Qualcomm (NASDAQ:QCOM) and Micron Technology (NASDAQ:MU).
This, along with Tesla (NASDAQ:TSLA)'s growth warning on Wednesday, likely deepened worries over rich valuations of heavily weighted megacap companies. Five of the «Magnificent Seven» — Apple (NASDAQ:AAPL), Microsoft (NASDAQ:MSFT), Amazon.com (NASDAQ:AMZN), Alphabet (NASDAQ:GOOGL) and Meta Platforms (NASDAQ:META) — are due to report their results next week.
Chipmaking tools maker KLA Corp also shed 3.4% following its third-quarter revenue forecast below estimates.
A recent run in chip and technology stocks
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