Wall Street looked set to see chipmakers continue their rebound on Tuesday, with investors continuing to pick through the wreckage of last week’s tech sell-off ahead of key US inflation data.<\/p>\n
Futures pointed higher across the board, with contracts on the Nasdaq 100 up 0.9%, S&P 500 futures rising 0.4% and Dow Jones futures gaining 0.2%.<\/p>\n
The positive tone follows a tentative recovery at the start of the week, when the Nasdaq Composite climbed 0.9% to close at 25,930 as investors returned to beaten-up semiconductor stocks, and the S&P 500 added 0.3% to finish at 7,406.<\/p>\n
The Dow Jones was the odd one out, slipping 81 points to 50,786.<\/p>\n
Semiconductor stocks led the rebound after Friday’s sharp rout, which was triggered by stronger-than-expected US jobs data and concerns that stretched valuations left the sector vulnerable to profit-taking. Nvidia, AMD, Micron and Broadcom all recovered some lost ground.<\/p>\n
“Friday’s selloff didn’t come out of nowhere,” said market analyst Kenny Polcari at Slatestone Wealth. “It was the collision of not one but two powerful forces that had been building for weeks \u2013 the stretched technology trade and the stronger than expected economic data.”<\/p>\n
The sell-off reflected concerns that a resilient US economy could keep inflation elevated and force the Federal Reserve to maintain higher interest rates for longer, he said.<\/p>\n
Investors will get fresh clues on that front this week, with consumer price inflation due on Wednesday and producer price data on Thursday.<\/p>\n
Meanwhile, oil prices continued to retreat from last week’s highs, with WTI dropping back below $90 a barrel, having topped $95 at the start of the week and almost $97 last week.\u00a0This eases some concerns about energy-driven inflation and helps support risk appetite.<\/p>\n
Asian and European markets were mostly higher in the early hours of Tuesday, with Nikkei closing up 2.2% in Tokyo, and the Kospi surging 8.2% in Seoul. Further west, the FTSE 100 was down 0.2% in London, while there were good gains on the Continent, ranging from 0.6% to 1.9% as Italian banks and French and Spanish fashion brands led the way.<\/p>\n