Nasdaq-100 nears correction as semiconductor stocks continue to fall
The Nasdaq-100 is approaching a technical correction due to ongoing weakness in semiconductor and major tech stock sectors. The PHLX Semiconductor Index (SOX) has fallen more than 24% from its June high, entering bear market territory earlier this month. This decline comes after strong performance during the second quarter that helped lift broader indexes like the S&P 500 to record levels. The selloff is being driven by concerns over AI investment returns and growing competition in memory chip markets, particularly from Chinese firms. Major semiconductor names such as Sandisk (SNDK) have lost more than half their value since June's peak. The weakness has spread beyond the Nasdaq-100 to include companies like Microsoft (MSFT), Alphabet (GOOGL/GOOG), and South Korean memory giants Samsung and SK Hynix. Despite strong earnings reports from some firms, investors remain skeptical about long-term returns on AI infrastructure investments. Analysts are questioning whether recent declines represent a temporary positioning reset or the start of a larger pullback in what was once one of the hottest trading sectors.
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Topics: AI trade Nasdaq-100 semiconductor stocks stock selloff