US STOCKS-Wall St rebounds after slump; chipmakers hit Nasdaq
By Ryan Vlastelica
NEW YORK Oct 10 (Reuters) - The Dow and S&P 500 rose on Friday, modestly rebounding after a sharp decline in the previous session, though weakness in chipmakers limited the Nasdaq's advance.
Major indexes remained on track for a sharply lower week as investors continued to fret about the pace of global growth and its impact on corporate earnings.
Semiconductor stocks slumped after Microchip Technology Inc warned on sales and said an industry correction had begun. The company, whose shares lost 11.5 percent to $40.25, also said more bad news could be on the way from other chipmakers.
Intel Corp fell 2.4 percent to $32.77 while Texas Instruments sank 6.8 percent to $42.87 and Micron Tech lost 6.1 percent to $28.77. The Philadelphia SE Semiconductor index fell 4.8 percent and is on track for its biggest weekly decline since May 2012.
"Investors may have to worry beyond Friday about the consequences of the Microchip warning," Andrew Wilkinson, chief market analyst at Interactive Brokers Group, wrote in a note. He added that the group was a possible "canary in the coalmine."
The S&P closed below its 150-day moving average for the first time since November 2012 on Thursday, a sign that near-term trends are weaker. The next technical level in view is the S&P's 200-day moving average, which at 1,904.84 is 1.2 percent below Thursday's close.
"All eyes will be on the 200-day moving average" today, said Jonathan Krinsky, chief market technician at MKM Partners in Greenwich, Connecticut, adding that the index would test that level before the current pullback ends.
"At that point we can evaluate the structure to determine (if) a bigger pullback is at hand." Continuación...