Nasdaq futures drop as chip stocks tumble after Strait closure

Nasdaq futures fell about 290 points in premarket trading as losses in technology and memory-chip stocks weighed on the index. Dow futures were little changed. S&P 500 futures slipped about 0.3% and Nasdaq-100 futures fell roughly 0.9%.

Memory-chip names led the declines. Micron Technology fell 5.2%, Western Digital lost 6%, Seagate dropped 4.8% and SanDisk slid 6.6%. The iShares Semiconductor ETF declined about 2.7%. US-listed shares of SK Hynix plunged roughly 9.3% after a high-profile Nasdaq debut last Friday.

Crude oil futures rose more than 2% after Iran announced it had closed the Strait of Hormuz, a major route for global oil shipments. Traders priced higher supply risk into oil markets, lifting energy costs and adding to inflation concerns. Energy prices are included in measures of consumer inflation that the Federal Reserve monitors when setting policy.

Markets face a packed economic and corporate calendar this week. The US consumer price index for June is due Tuesday, followed by producer price and retail sales reports later in the week. Federal Reserve Chair Kevin Warsh is scheduled for his first congressional testimony this week. Futures traders are pricing in at least one 25-basis-point interest-rate increase by year-end.

Earnings season will test market resilience. Major banks including JPMorgan Chase, Goldman Sachs and Morgan Stanley report results this week, with companies such as Netflix, General Electric and UnitedHealth reporting afterward. LSEG IBES projects S&P 500 earnings to rise about 23.7% year over year, with technology firms accounting for much of the projected gain.

The S&P 500 remains more than 10% higher year-to-date and traded less than 1% below its early-June record prior to the latest selling. Analysts continue to forecast sustained long-term demand for memory and data-center hardware; short-term volatility has increased as markets digest economic data, corporate results and the recent geopolitical developments.