Nasdaq Plunged More Than 1%: The AI Sell-Off Continues
Photo: X / NYSE
The Nasdaq Composite Index plummeted by more than 1% during trading on July 7: Investors are questioning the stock market rally driven by AI developments and are also assessing reports that DeepSeek, a Chinese competitor to Anthropic and OpenAI, is developing its own AI chip, Reuters reports.
Details
Against this backdrop, the Nasdaq Composite lost 1.3% on Tuesday, the broad U.S. stock index S&P 500 fell 0.5%, while the blue-chip index showed gains in the first minutes after the market opened, heading toward new record highs, but at the time of publication had also slipped slightly into negative territory—losing a symbolic 0.04%.
CNBC notes that chipmakers’ stocks are once again among the biggest losers. The Philadelphia Semiconductor Index, which tracks semiconductor stocks, fell 7% on July 7. Shares of Micron—one of the three largest manufacturers of computer memory—plummeted by the same amount; shares of KLA (down more than 8%), Marvell Technology (down 9%), Broadcom (down 2.5%), and AMD (down 8%).
Investors are shifting their focus to companies in other market sectors and buying, among other things, shares of big-tech companies that have recently declined, as well as stocks in the healthcare and financial sectors, CNBC notes. Against this backdrop, shares of Eli Lilly, one of the world’s largest pharmaceutical companies, jumped more than 3% on July 7; Microsoft rose 1.5%; Walmart by 1.4% (after the company announced price cuts on items such as ground beef), and Coca-Cola by 2.5%.
What People Are Saying in the Market
Pressure on the AI market began on Tuesday in the Asia-Pacific region. South Korea’s Kospi index fell nearly 5%—following a nearly 7% drop in shares of memory chip maker Samsung Electronics. The company reported significant profit growth in the second quarter, but investor concerns about future AI spending by major Western companies, as well as demand for Samsung’s products, overshadowed that growth, according to CNBC.
This article is being updated
This article was AI-translated and verified by a human editor
