US EQUITY OPEN: Tech dives after Samsung earnings and China chip reports but underlying breadth remains positive

Stocks have opened mixed on Tuesday, with notable pressure in the Nasdaq after Samsung's preliminary Q2 results disappointed lofty expectations, raising concerns that expectations had become stretched following the recent rally in memory stocks. Adding to the downside were reports suggesting China is accelerating efforts to reduce its reliance on US semiconductor technology. DeepSeek and Zhipu AI are reportedly considering developing their own AI chips, while Chinese authorities have met with leading technology executives to discuss restrictions on overseas access to China's most advanced AI models.

The Nasdaq has opened around 1.4% lower, while the S&P 500 is down just 0.2%. In contrast, the equal-weight S&P 500 is firmer, highlighting positive market breadth with losses largely concentrated in the technology sector.

Only Technology and Industrials are trading lower. The latter is being weighed on by heavyweight names including Caterpillar (CAT), GE Aerospace (GE) and GE Vernova (GEV), with GE Vernova the notable laggard given its exposure to the AI theme through supplying power infrastructure for energy-intensive data centres. The weakness appears to reflect a knock-on effect from the selling in semiconductor and memory stocks. All other sectors are in positive territory, led by Consumer Staples, Energy, Utilities and Health Care. Energy is outperforming as crude prices move higher after Iran reportedly fired missiles at tankers overnight, while the UKMTO later reported another incident in the Strait of Hormuz.

In FX, the Yen is marginally outperforming while the New Zealand Dollar lags ahead of tonight's RBNZ policy decision. The Dollar is broadly unchanged.

Treasuries are weaker across the curve after Amazon (AMZN) filed to issue USD-denominated debt in an eight-part offering, with reports suggesting the company is seeking to raise around USD 25bln. Some additional concession is also likely ahead of this week's Treasury supply, which includes 3-year, 10-year and 30-year auctions.

• Samsung Electronics shares fell overnight after it announced the prelim. Q2 figures.
• Nvidia (NVDA): DeepSeek developing its own AI chip & would be used for inference, not for training AI models
• Fiserv (FISV): JPM, BAC & other large banks held prelim. talks to acquire a Fiserv debit-card network
• Rivian (RIVN): Filed to sell 75mln shares of common stock, although provided strong next Q rev. outlook
• Crinetics Pharmaceuticals (CRNX): To be acquired by VRTX for $85/shr in cash; CRNX closed Mon. at $42.03/shr
• First Solar (FSLR): Upgraded at Deutsche Bank.
• Walmart (WMT): Is lowering prices on thousands of items, including beef, soda and household goods