US Stock Futures Slip After Tech Rally, SK Hynix Starts Trading

236yyt56g]yt9qn4bxn323eh_media_dl_1.png Bloomberg

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(Bloomberg) — US equities were moving between losses and gains Friday as investors digested the record US listing of South Korea’s SK Hynix Inc. and prepared for the start of second-quarter earnings season.

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The S&P 500 was 0.1% higher as of 9:45 a.m. in New York, while Nasdaq 100 fell 0.2%, suggesting some caution after technology shares helped lift stocks on Thursday.

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SK Hynix raised $26.5 billion in the largest-ever US initial share sale by a foreign company. The memory-chip maker sold 177.9 million American depositary receipts at $149 each, with every ADR representing one-tenth of a Seoul-listed common share. The blockbuster debut is expected to fuel demand for leveraged exchange-traded funds tied to the stock, underscoring the continued enthusiasm among retail investors for AI-related trades.

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The market is approaching a potentially pivotal earnings season. Analysts have continued to lift forecasts ahead of second-quarter reports, with HSBC noting that S&P 500 profit estimates have risen to an expected 22% year-over-year increase — an unusual pattern this close to reporting season and the strongest projected growth since the pandemic recovery.

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Meanwhile, the S&P 500’s technology sector is sending a split signal. The index sits within a whisker of a record, yet more than half its members trade at least 20% below their own 52-week highs — a washed-out breadth reading normally seen near market lows, not peaks. A handful of mega-caps are masking a correction already unfolding beneath the surface.

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The S&P 500 is on pace to post the second weekly gain despite a flare-up in geopolitical tensions between the US and Iran. The market absorbed another round of geopolitical uncertainty without violating key support levels, while the S&P 500 and Nasdaq successfully reclaimed their 50-day moving averages and market participation continued to broaden beyond the mega-cap leaders, according to Craig Johnson, chief market technician at Piper Sandler & Co. 

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“We continue to see improving relative strength in Industrials, Financials, Healthcare, and SMID-cap stocks, suggesting this remains a rotational bull market rather than a narrow leadership rally,” Johnson said. 

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Tech stocks were leading gains this week after a bout of turbulence in semiconductor shares. JPMorgan Chase & Co.’s trading desk noted that positioning in semiconductor and memory stocks had reached extreme levels, suggesting the upcoming earnings season will place greater emphasis on corporate guidance and strategic updates from hyperscale technology companies. 

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Among single stock movers, Netflix Inc. shares edged lower after the Wall Street Journal reported on steps the video-streaming company is considering to counter signs of declining subscriber engagement. EasyJet shares jumped after the budget airline received a fresh bid from private equity firm Apollo that beats a rival proposal from Castlelake. The shares remain below both offer prices. Analysts believe there is scope for Castlelake to table a new rival bid. 

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Delta Air Lines Inc. reaffirmed its full-year profit guidance, citing strong demand for premium, corporate and international travel that helped offset the highest quarterly fuel expense in its history.

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Fermi Inc. shares fell after the energy development firm priced an upsized offering of $375 million in 5.00% convertible senior notes due 2031, with an option for initial purchasers to buy up to an additional $56.25 million in notes.

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—With assistance from Jan-Patrick Barnert.

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