Chip selloff sends technology stocks into record rout
Technology shares plunged as investors questioned the AI trade, erasing a record $2.3 trillion from the Nasdaq 100 in one session.
Technology shares suffered their sharpest one-day fall in years on Thursday as investors pulled back from the artificial-intelligence trade, wiping a record $2.3 trillion from the value of the Nasdaq 100, according to Bloomberg.1
The Nasdaq 100 fell 6.4%, while the broader S&P 500 dropped 4.4%. Semiconductor shares were hit hardest: a gauge tracking the sector fell 12%, its worst session since the early months of the Covid-19 pandemic in March 2020.1
The move was not limited to one chipmaker or one corner of the market. Bloomberg described the selloff as a sector-wide rout, with technology leading a broader retreat in US equities. The immediate concern was whether expectations around artificial-intelligence spending and future returns had run too far ahead of the companies' ability to deliver them.1
That matters in Britain and Europe even when the headline numbers are American. Chip designers, equipment makers and cloud companies are priced through a global supply chain, while pension funds and technology-heavy investors outside the US are exposed to the same concentration risk. A sharp move in US semiconductor benchmarks can therefore affect portfolios and sentiment well beyond Wall Street.
The latest fall also lands after a long period in which AI-linked companies helped drive the market higher. A reversal does not, by itself, prove that the underlying businesses are failing. It does show how quickly a crowded trade can turn when investors begin questioning valuations, spending plans or the timetable for profits.
Our opinion
The useful takeaway is not that AI has suddenly stopped mattering. It is that the market is now demanding evidence for every expensive promise. A $2.3 trillion one-day wipeout is an extraordinary warning about concentration and expectations, but it is not a verdict on every chip designer or cloud platform. Readers should treat the move as a risk signal, not as a neat explanation for what happens next.
The accompanying hero is an abstract Pexels photograph of trading screens and falling charts. It illustrates the market move without pretending to show a specific company or exchange.