Another day where chips pulled everything lower. Most stocks were actually fine. Few big names dragged the index down. Meta went the other way entirely.
Semiconductor Stocks Drag the S&P 500 Lower
S&P 500 fell 0.2% Wednesday. Nasdaq dropped 0.7%. Dow barely moved.
Underneath those numbers things were not actually that bad. More stocks went up than went down on the day. The problem is chipmakers carry so much weight in the indexes that when they fall hard the whole thing looks worse than it is.
Sandisk, Micron, and Intel led the selling. Same story as last week. Investors questioning whether AI spending translates into profits fast enough to justify where these stocks are priced. No new news really. Just the same doubt that has been circling the chip sector for the past couple weeks coming back around.
Meta Rises on AI Infrastructure Plans
Six of the seven big tech names actually moved higher Wednesday. Meta led them.
Bloomberg reported Meta is looking at selling surplus computing power to outside customers. Company has built enormous AI infrastructure. When it is not using all of it internally renting that capacity out makes sense. Turns idle hardware into revenue.
Not a new business model. Amazon did it with AWS. Microsoft did it with Azure. Both turned internal infrastructure into massive cloud businesses. Meta exploring the same path is logical. Market liked the idea and the stock moved up on it.
Jobs Report Could Decide the Next Move for the S&P 500
Trading was quiet Wednesday and that was intentional. Friday is a holiday. Long weekend coming. Nobody wants to make big bets before Thursday’s jobs report lands.
Economists are expecting about 115,000 new jobs added in June. That number matters a lot right now because the Fed is watching the labor market closely to decide whether to raise rates. Strong jobs data equals more rate hike risk. Weak data gives the Fed more reason to hold.
Early Thursday futures were already slipping into the red. South Korea did not help. Kospi dropped 8%. Kosdaq fell 6.8%. Asia going down that hard before a major US data release adds nervousness to an already cautious morning.
Jobs number drops Thursday. Markets are closed Friday. Whatever the number says will sit with investors all weekend with no chance to react until Monday. That dynamic usually makes the pre-report trading extra careful.