Intel Blamed the Memory Shortage, and the Memory Stocks Fell Too

Intel guided low, and Nasdaq futures are off 2.6%. Its revenue guide for the quarter is $15 to $16 billion against about $17.1 billion expected. The CEO put it on a memory shortage that has pushed up PC prices and cut demand, and the company sees the PC market shrinking through at least the first half of next year. Intel is down about 25% premarket. Amazon missed on earnings, kept its roughly $220 billion capex plan and is down about 8% even with AWS up 39%. The employment cost index rose 0.8% for the quarter, on forecast, and Chicago PMI is at 9:45. SPX closed 7,720.39 Thursday, down 0.30%. Premarket 7,640.

The memory part is what doesn't add up. It's the same shortage that handed SK Hynix an 80% operating margin this week, and Intel says memory pricing stays high into next year, which read one way is a reason to own the companies selling it. Micron is down about 7% premarket after falling Thursday, and Hynix lost about 7% in Seoul. Now the tape is selling both ends of the shortage at once, the supplier and the customer paying for it. It's also narrower than the index makes it look. SPX fell 0.3% Thursday while the equal-weight S&P rose 1.2%, and this morning Dow futures are flat while the Nasdaq takes the whole hit.

Premarket sits on Monday's low, the base this whole week was built from, and 10 under a put wall at 7,650 that's the biggest node on the profile. With price below it, that wall works as resistance. The whole profile runs about 16 to 1 negative with almost no positive gamma anywhere, so dealers chase moves in both directions and the call side barely registers until the 7,705 flip. Underneath, the negatives don't thin. There's 7,625, and then 7,600, nearly as big as the put wall and sitting right on prior demand, which is where the downside fuel finally runs out.

The lean is short on a pop into 7,650, the put wall now overhead, for 7,627 and 7,612. Selling 7,640 at the open sells Monday's low into the gap. A loss of 7,596 opens the 7,580s, and a reclaim of 7,670 ends the short.