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Nasdaq falls 1.19% as negative Micron guidance weighs down tech stocks

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The Nasdaq Composite fell 1.19% as chipmaker Micron issued negative guidance that dragged down tech stocks. File Photo by John Angelillo/UPI | <a href="/News_Photos/lp/b024b4b87f1620f14a45f89571b56c57/" target="_blank">License Photo</a>
The Nasdaq Composite fell 1.19% as chipmaker Micron issued negative guidance that dragged down tech stocks. File Photo by John Angelillo/UPI | License Photo

Aug. 9 (UPI) -- U.S. markets declined as chip stocks continued to struggle Tuesday, dragging down the tech market.

The Dow Jones Industrial Average dipped 58.13 points, or 0.18%, the S&P 500 fell 0.42% and the tech-heavy Nasdaq Composite slid 1.19%.

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Tuesday's decline came as shares of chipmaker Micron fell 3.74% after the company warned that its revenue could fall short of its prior guidance, citing "macroeconomic factors and supply chain constraints."

On Monday, fellow chipmaker Nividia also announced its revenue for the second quarter declined by 19% from the quarter prior.

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"These are two big players that I think investors thought were in a better position to navigate through some of these recent supply chain issues. I think there's concern that this is really going to weigh on tech," said Ed Moya, a senior market analyst at Oanda.

Novavax stock also weighed on the Nasdaq as shares fell 29.64% after it cut its full-year revenue guidance citing poor demand for its COVID-19 vaccines.

Cryptocurrency exchange Coinbase reported lower-than-expected earnings after the bell as revenue fell to $808.3 million compared to $854.8 million expected by analysts, Bloomberg reported.

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Coinbase also lost $1.1 billion in the three-month period ending June 30, while monthly transacting users also dropped to 9 million in the second quarter, a 2% decline from the prior quarter.

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Shares of the company fell 10.55% during regular trading and declined 4.88% after hours.

Morgan Stanley Chief Investment Officer Michael J. Wilson on Monday wrote in a note that corporate profit margins are likely to contract next year "due to sticky cost pressures and receding demand."

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"While prices to the end consumer are still rising at a rapid clip, prices for producers are rising at double the pace," Wilson wrote.

Investors are awaiting the July consumer price index, which is to be released Wednesday and expected to show a decrease in the rate of inflation.

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