Investing.com - Chipmakers came under pressure Tuesday as Samsung Electronics' (KS:005930) profit warning served as a stark reminder that weak memory demand will continue to weigh on semiconductor stocks.
Samsung expects fourth-quarter profit to drop 29% to 10.8 trillion won ($9.6 billion), about 3 trillion below the average estimate. That fuelled concerns about the outlook for semiconductors, many of which make chips for tech behemoths.
Semiconductor equipment maker KLA-Tencor (NASDAQ:KLAC) fell 2%, shrugging off a positive note from Wall Street.
In a note to clients, Cowen singled out KLA-Tencor as its top pick, citing the company is "relatively defensible," from falling memory prices as it has "higher exposure to non-memory verticals like foundry & NAND."
Among other semi stocks, Lam Research (NASDAQ:LRCX) and Applied Materials (NASDAQ:AMAT) also fell more than 2%.
Nvidia (NASDAQ:NVDA), meanwhile, struggled to sidestep the weaker sentiment on semis, falling more than 2% even as it revealed its Drive AutoPilot platform, which it said would pave the way for the next level of self-driving cars by 2020.
The drop in Nvidia comes a day after the chipmaker soared after unveiling its new graphics chips on Sunday for gaming laptops.
The Philadelphia Semiconductor Index fell more than 1%.