US equity futures and major exchange-traded funds declined in premarket trading Thursday, with the Nasdaq futures retreating 1.6% and the SPDR S&P 500 ETF Trust (SPY) down 0.9%. The market move followed a report that Nvidia and Tesla intend to place a joint investment of 3.7 trillion South Korean won ($2.80 billion) into Samsung Electro-Mechanics to increase output of advanced semiconductor substrates.
The broader risk-off tone was evident across asset classes, with bitcoin falling 3.2% and the ProShares Bitcoin Strategy ETF (BITO) dropping the same percentage. In the technology sector, the State Street Technology Select Sector SPDR ETF (XLK) retreated 2%, while semiconductor-specific funds saw sharper declines; the iShares Semiconductor ETF (SOXX) fell 3.7% and the State Street SPDR S&P Semiconductor ETF (XSD) declined 2.2%. Nvidia shares were down more than 2% in premarket activity, extending a similar move from the prior session.
Earnings results from major corporations also weighed on sentiment. Tesla shares fell more than 3% following the company's report of lower third-quarter adjusted earnings and revenue. Snap-on stock dropped more than 9% after announcing lower fiscal third-quarter earnings and net sales, while United Bankshares shares declined 1% after its own third-quarter financial results. Conversely, Liberty Energy stock rose more than 5% after swinging to third-quarter adjusted earnings amid higher revenue.
Labor market data provided a mixed backdrop for the session. US initial jobless claims fell to 194,000 in the week ended Oct. 17, down from an upwardly revised 200,000 in the previous week and below the 200,000 level expected by analysts in a Bloomberg survey. Further economic data was scheduled for release later in the day, including September leading indicators at 10 am ET, weekly natural gas stocks at 10:30 am ET, and the Kansas City Federal Reserve's October manufacturing reading at 11 am ET.
Sector performance varied significantly outside of technology. Healthcare showed relative strength, with the State Street Health Care Select Sector SPDR ETF (XLV) advancing 0.7%. Biohaven stock surged 35% after a regulatory filing indicated the US Food and Drug Administration accepted its resubmitted New Drug Application for Vyglxia or troriluzole. Energy stocks also gained ground, with the State Street Energy Select Sector SPDR ETF (XLE) up 0.8%, as front-month US West Texas Intermediate crude oil rose 2.3% to $99.41 per barrel on the New York Mercantile Exchange.
Precious metals faced broad selling pressure. Gold futures for November retreated 1.5% to $4,086.60 an ounce on the Comex, while silver futures fell 3% to $55.96 an ounce. Consumer staples provided a defensive holdout, with the State Street Consumer Staples Select Sector SPDR ETF (XLP) up 1.2%, although consumer discretionary names lagged, with the State Street Consumer Discretionary Select Sector SPDR ETF (XLY) losing 1.3%.