A significant selloff in semiconductor stocks pressured US equity markets, with the S&P 500 declining by 0.28% and the Nasdaq falling 0.76%, according to Deutsche Bank strategists. The equal-weighted S&P 500, however, managed a modest gain of 0.10%, bringing it within 0.5% of its all-time high, as the broader market showed resilience despite sector-specific weakness [1].
The downturn was led by renewed concerns over AI-chipmaker stocks. Sandisk dropped 6.45% and Micron fell 5.83%, ranking among the worst performers in the S&P 500. The Philadelphia Semiconductor Index also declined by 2.70%. Nvidia, a key AI chipmaker, fell 2.91% ahead of its earnings release scheduled for tomorrow, marking its seventh consecutive daily decline—the longest such streak since September 2022 [1].
The negative sentiment from US tech stocks extended into Asian markets, with the KOSPI down 0.72% after recovering from an earlier drop of more than 2%. Other Asian indices, including the CSI 300 (-0.46%), Shanghai Composite (-0.15%), and Hang Seng (-0.25%), also traded lower. In contrast, the Nikkei (+0.49%) and Australia’s S&P/ASX 200 (+0.54%) posted gains, bucking the regional trend [1].
Despite the previous session's declines, US equity futures showed slight improvement in Asian trading, with S&P 500 futures up 0.12% and Nasdaq futures rising 0.35%. European equities were mixed, as the Stoxx 600 was nearly flat (+0.005%), with the FTSE 100 (+0.35%) and IBEX 35 (+0.69%) offsetting losses in the CAC 40 (-0.37%) and DAX (-0.11%) [1].
CONCLUSION
The semiconductor sector's sharp decline weighed heavily on major US indices, particularly ahead of Nvidia's highly anticipated earnings report. While the broader market showed some resilience, sentiment remains cautious, with global markets reacting to the tech-led downturn. Investors are closely watching Nvidia's upcoming results for further direction.