Semiconductor stocks doing the rotational driving

*Semiconductor stocks are under selling pressure again, which means the Nasdaq 100 futures are, too.

*UNH, GE, and ABT have set a nice course for blue-chip stocks with their earnings reports and guidance.

*June retail sales were not as disappointing as the headlines suggest.

We’re going to begin today where we pretty much have to begin, as it seems all rotational roads lead through the behavior of the semiconductor stocks. They are down this morning, following form with an ugly showing from South Korea’s Kospi (-6.4%) that was paced by weakness in SK Hynix (SKHY).

The connection is that the weak sentiment there has carried over here, so much so that a strong report and outlook out of Taiwan Semiconductor (TSM) hasn’t even moved the needle. In fact, TSM is down 4.0% in pre-market trading.

Of course, what happens pre-market for the semiconductor stocks doesn’t always stay pre-market, which is to say this group has an astounding capacity to attract buy-the-dip interest. That point aside, the current weakness is a driving factor for the underperformance of the Nasdaq 100 futures.

Currently, the S&P 500 futures are down 24 points and are trading 0.5% below fair value, the Nasdaq 100 futures are down 281 points and are trading 1.0% below fair value, and the Dow Jones Industrial Average futures are up seven points and are trading fractionally above fair value.

UnitedHealth (UNH), up 7.5% after its better-than-expected Q2 results and guidance, is the engine driving the outperformance of the Dow Jones Industrial Average futures, although blue-chip stocks are likely garnering some increased interest in the face of the tech sector’s weakness, aided as well by better-than-expected results and guidance from the likes of GE Aerospace (GE) and Abbott Labs (ABT).

This morning’s economic data should be helping in that regard as well.

• Total retail sales were up 0.2% month-over-month in June (Briefing.com consensus: 0.2%) following an upwardly revised 1.0% increase (from 0.9%) in May. Excluding autos, retail sales were down 0.2% month-over-month (Briefing.com consensus: 0.1%) following an upwardly revised 1.0% increase (from 0.8%) in May.
  • The key takeaway from the report is that the headline disappointments are misleading, as they were driven primarily by gasoline station sales (-5.3%). Excluding gasoline stations, retail sales were up a solid 0.7% in June on the heels of a 0.9% increase in May.
• Initial jobless claims for the week ending July 11 decreased by 8,000 to 208,000 (Briefing.com consensus: 219,000). Continuing jobless claims for the week ending July 4 were down 16,000 to 1.805 million.
  • The key takeaway from the report is that initial jobless claims remain historically low and a signpost for a labor market that is still light overall on layoff activity.
• The Philadelphia Fed Index surged to 41.4 in July (Briefing.com consensus: 11.0) from 10.3 in June. The dividing line between expansion and contraction for this report is 0.0, so the July reading marks a notable acceleration in manufacturing activity in July in the Philadelphia Fed region versus the prior month.
  • The key takeaway from the report is that its strength was concentrated in new orders, shipments, and employment conditions, all of which were pitted against a relatively tame bump in the prices paid index.

Other key news items include Uber (UBER) buying Delivery Hero in a $14.8 billion cash deal; Eli Lilly (LLY) acquiring AtaiBeckley (ATAI) for $6.75 per share in cash plus up to $2.50 per share for contingent value rights; and Iran laying down a “red line” for the U.S., saying it will crush key targets in the Middle East if the U.S. follows through next week on bombing Iran’s bridges and power plants.

WTI crude futures are up 1.0% to $80.41/bbl. Separately, the 2-yr note yield is up four basis points to 4.17%, and the 10-yr note yield is up four basis points to 4.59%.

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Originally Posted July 16, 2026 – Semiconductor stocks doing the rotational driving