Chipmakers’ Decline Outweigh Fed Official’s Remarks Against Hiking Rates More Than Once. Stocks Edged Down.

Stocks edged down on Tuesday as a chip rout outweighed remarks from a Federal Reserve official who spoke in favor of not hiking interest more than once.

The S&P 500 dropped 0.02%, while the tech-heavy Nasdaq Composite did so 0.15%. The Dow Jones Industrial Average underperformed, declining 0.35%.

Chipmakers fell after ChangXin Memory Technologies (CXMT), China’s leading memory chip manufacturer, announced progress on a memory chip design that could challenge some of the industry’s biggest players.

The company outlined a technological advance that could allow it to produce more efficient memory chips capable of storing greater amounts of data in smaller spaces.

The declines reflected growing investor anxiety about China’s ability to compete in one of the semiconductor industry’s most profitable segments, particularly as memory chips become increasingly important to artificial intelligence infrastructure.

A spokesperson for independent market research studio LEOW Quant Technologies told International Business Times that “options traders had been cooling on Micron for over a week. “

“A Chinese rival packing more data into less space is a pricing threat to a memory maker like Micron, and for Nvidia it’s mostly a question of supply and cost. If NVDA’s call share starts to slide toward Micron’s, I’d read that as the worry spreading from memory pricing to the whole AI hardware chain,” the spokesperson added.

Elsewhere, New ​York Federal Reserve President John Williams reiterated his view that the central bank should hike rates once more this year and leave them unchanged next year, at least considering the current scenario.

“I don’t think at this time I have any reason to believe that we would need to do ​more,” Williams added in an interview with Bloomberg News. “it’s still mid-October. This economy is being affected by lots of different ​influences, and we just have to keep watching the data.”

Markets will also be on the lookout for news about Anthropic’s quarterly financial performance as it could influence not only the company’s anticipated blockbuster initial public offering but also investor confidence in the broader artificial intelligence industry.

The San Francisco-based AI developer plans to present its third-quarter financial results to institutional investors on Wednesday, according to CNBC.

According to people familiar with the company’s plans, Anthropic is pursuing a listing that could value it at approximately $2 trillion, supported by revenue projections that could exceed $100 billion by the end of 2026. Such a valuation would potentially surpass the historic public debut of Elon Musk’s SpaceX.