Dow futures rise and Nasdaq futures fall as chip stocks keep sliding

Dow futures rose and Nasdaq-100 futures fell Thursday morning as chip stocks kept sliding.

As of 6:56 a.m. Eastern time, before the Bank of England announced its decision, Dow futures were up 346 points, or 0.6%, and Nasdaq-100 futures were down 136 points, or 0.5%. S&P 500 futures were up 0.2%.

On Wednesday both had risen. The Dow gained 3%, and the Nasdaq-100 gained 0.9%, after Democrats won both the House and the Senate.

What changed overnight was the chip selloff. Bloomberg reported that the selloff was extending on fears a Democratic Congress would tighten rules on data centers and hit demand. Barron's said the split in the futures reflected a shift out of artificial-intelligence stocks and into industrial, financial and health care companies.

Chip stocks keep falling

Qualcomm was the sharpest drop. Shares were about 9% lower before the open, Reuters said, after smartphone chip sales missed estimates.

Those sales are the handset business. Revenue there fell 26% from a year earlier, to $5.14 billion, against the $5.25 billion analysts expected, Reuters said. Reuters also said the company is caught between rising memory costs, fueled by demand from data centers, and slowing smartphone sales.

For the current quarter, Qualcomm forecast earnings of $2.15 to $2.35 a share on revenue of $10.4 billion to $11.2 billion. CNBC said the earnings forecast was lighter than the $2.27 a share analysts expected. Reuters said the middle of the revenue range is above the $10.48 billion estimate.

Bloomberg reported that Ed Yardeni, president of Yardeni Research, said political oversight and local resistance to data centers are unlikely to stop spending on artificial intelligence, because states that want the projects will welcome them even if others will not.

BlackRock's iShares Semiconductor ETF SOXX begins split-adjusted trading today after a 3-for-1 split. Wednesday's close of $450.41 equals $150.14 a share after the split.

Before the open, the bid was $145.76 and the ask was $145.98. The middle of the bid and ask was 2.8% below the split-adjusted close. A price near $150 is the split, not a collapse from Wednesday's $450.41.

Oil is higher after Wednesday's drop

A later reading, at 7:06 a.m. Eastern, put West Texas Intermediate crude at $89.72 a barrel, up 1.9% on the day. Brent crude was at $96.69, up 2.2%.

Bloomberg reported that oil tumbled almost 9% on Wednesday as investors bet a Democratic sweep could speed an end to the war in the Middle East. Reuters said Thursday's rise came as investors weighed the future of the U.S. and Israeli war with Iran after the Republican losses.

The Bank of England raises its key rate

The Bank of England raised its key rate by a quarter point on Thursday, to 4%, from 3.75%. The committee voted 8 to 1. The dissenter wanted a half-point increase, to 4.25%, not a pause.

The Bank said the conflict in the Middle East is in its ninth month and energy prices have kept rising. Inflation was 3.5% in September, and the Bank expects it to reach about 5% by the middle of next year. It said there was now enough inflation pressure ahead to justify the increase.

The quarter-point rise was what most analysts had predicted, the BBC reported.

October's jobs report, from the Bureau of Labor Statistics, is due Friday at 8:30 a.m. Eastern.