Broadcom’s revenue miss and cautious AI-chip outlook sparked a selloff in semiconductor stocks, while official services data showed the U.S. economy’s largest sector still expanding. Futures pointed to stronger pressure on the Nasdaq than the Dow.
Broadcom’s latest results hit semiconductor stocks on Thursday, while a separate read on the U.S. services economy helped keep the market backdrop from turning fully defensive.
Reuters reported that Broadcom shares fell sharply after the chipmaker missed quarterly revenue expectations and gave a softer outlook tied to AI-chip demand. The move rippled through the semiconductor group and weighed on Nasdaq-linked futures.
In premarket trading on June 4, Reuters said S&P 500 and Nasdaq 100 futures were lower after the Broadcom reaction, while Dow E-minis were higher. That suggested the day’s market pressure was concentrated in tech rather than spread evenly across major indexes.
The macro backdrop was mixed but not clearly recessionary. The Institute for Supply Management said its May Services PMI came in at 54.5, indicating the services sector expanded for a 23rd straight month. The report also showed the prices index at 71.3 and the employment index at 47.9.
Taken together, the data and market reaction pointed to a familiar split: semiconductor stocks were under pressure after a disappointing AI-related update, while the broader economy still showed enough momentum to support parts of the market outside tech.
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Initial automated publication.