Tech Stocks Slide as Chip Sell-Off Deepens Amid AI Financing Concerns
U.S. tech stocks fell before the market open on Tuesday, with Nasdaq futures dropping 0.9% and S&P 500 futures declining 0.2%, driven by a deepening sell-off in South Korean memory chipmakers like SK Hynix and Samsung Electronics. The Kospi index dropped over 10%. Concerns about circular financing deals between AI leaders, such as Nvidia's potential $250 billion funding backstop for OpenAI, have soured sentiment on the sector. Investors are also worried that Chinese competition is closing the gap in AI capabilities with U.S. firms, reducing long-term growth expectations. Meanwhile, oil prices continued to fall after a pause in hostilities between the U.S. and Iran. The Federal Reserve's upcoming policy decision adds uncertainty as traders remain divided on whether rates will stay steady or rise. Earnings reports from major companies like Visa, Coca-Cola, Boeing, Ford, and PayPal are also under close watch.
Topics: AI stocks Fed policy memory chips stock market tech sector