Intel Corporation shares declined more than 3% during Tuesday's morning session, trading around $48.70 after opening near $50. The stock saw volume of approximately 22 million shares as it moved between $48.38 and $50.50.
Economic Data Shifts Market Focus
U.S. retail sales unexpectedly showed no growth in December, prompting investors to reassess the economic landscape. This data point arrives ahead of critical employment and inflation reports scheduled for release later this week, which could influence Federal Reserve policy decisions. "The retail numbers coming in below expectations have certainly captured attention," noted Charlie Ripley of Allianz Investment Management.
Policy Uncertainty Adds Pressure
Market sentiment was further complicated by a Financial Times report indicating the Trump administration might exempt companies like Amazon, Google, and Microsoft from upcoming tariffs on semiconductors used in artificial intelligence data centers. The proposed carve-outs, reportedly tied to investment commitments from Taiwan Semiconductor Manufacturing Co., remain unsigned and subject to change, adding another layer of uncertainty for chip investors.
Within the semiconductor sector, performance was mixed. Nvidia edged lower by approximately 0.4%, while Advanced Micro Devices held steady. Onsemi faced sharper declines, falling nearly 6% in extended trading after missing revenue estimates and reporting significant declines in some business segments.
Intel's Execution Challenge
Intel continues to face scrutiny over its ability to convert AI-related demand into financial performance. In late January, the company reported challenges in meeting demand for its server chips and provided first-quarter revenue guidance below analyst consensus. "We are disappointed that we cannot fully meet demand in our markets in the short term," CEO Lip-Bu Tan stated.
The broader technology sector remains volatile following recent AI-driven market movements. Traders are now anticipating several key events: the delayed January jobs report on Wednesday, the Consumer Price Index reading on Friday, and Nvidia's upcoming earnings later this month. For Intel specifically, the immediate risk involves navigating between soft economic data that could spur defensive positioning and persistent inflation that might delay anticipated interest rate cuts.
