By Ragini Mathur and Avinash P
July 16 (Reuters) – The S&P 500 and the Nasdaq were set for a lower open on Thursday as chip stocks weakened again, while investors parsed fresh economic data for clues on the health of the economy.
Semiconductor stocks extended losses from the previous session, when investors rotated into megacap technology names and banks after strong results from major lenders.
U.S.-listed shares of TSMC fell 3.9% in premarket trading, even after the advanced AI chipmaker reported a 77% jump in second-quarter profit that topped market expectations.
Memory-chip makers were among the biggest decliners, with Western Digital, Seagate Technology and Micron Technology down 7.2%, 5.7% and 5%, respectively.
Chip stocks were earlier among the biggest beneficiaries of this year’s rally, as optimism around AI spending by hyperscalers helped drive Wall Street to record highs.
The benchmark S&P 500 has risen more than 10% this year and remains close to its June record closing high, leaving the rally vulnerable to any disappointment.
Investors parsed June retail sales data that showed only a marginal rise as lower gasoline prices weighed on receipts at service stations. Still, bargain-hunting consumers continued to support underlying spending.
“Slower headline retail sales growth is actually positive, mainly because it reflects lower gasoline prices, not weaker consumer demand,” said Bill Adams, chief U.S. economist at Fifth Third Commercial Bank.
“The report is constructive for second-quarter real GDP.”
Separately, weekly jobless claims fell to 208,000 for the week ended July 11, below economists’ expectations of 217,000 and down from 216,000 in the prior week.
At 08:46 a.m. ET, Dow E-minis were up 18 points, or 0.03%, and S&P 500 E-minis were down 28.5 points, or 0.37%. Nasdaq 100 E-minis were down 307.5 points, or 1.03%.
The latest in a slate of upbeat quarterly results, UnitedHealth raised its 2026 profit forecast, sending shares of the healthcare giant up 6.8% and keeping Dow futures afloat .
Peers Humana and Centene gained 4.4% and 3.5%, respectively.
The main three U.S. indexes rose for a second straight session on Wednesday as this week’s benign inflation reports for June reduced worries over tighter Federal Reserve policy.
Markets are currently pricing in about 88% likelihood that the Fed will stay on hold at this month’s monetary policy meeting, according to CME’s FedWatch tool.
A strong start to the second-quarter earnings season has also underpinned sentiment, although geopolitical risks remained in focus as U.S.-Iran tensions simmered.
Iran has asked Yemen’s Houthi movement to stand ready to close the Red Sea oil route if the U.S. strikes Iranian power infrastructure, sources told Reuters, posing a fresh threat to global energy supplies.
United Airlines fell 3.4% as a renewed surge in oil prices weighed on its third-quarter and full-year profit outlooks.
GE Aerospace dipped 2.9%, despite the jet-engine maker lifting its 2026 profit forecast.
Netflix is scheduled to report its after the market’s close.
(Reporting by Ragini Mathur and Avinash P in Bengaluru; Editing by Maju Samuel and Devika Syamnath)
By Ragini Mathur and Avinash P | Reuters | © Copyright Thomson Reuters 2026.
