The Nasdaq Composite had its worst July in 20 years due to a plunge in chipmaker stocks

The Nasdaq Composite lost 3.2% in July, closing at 25,373.85 points heading into August. This marks the index’s worst July since 2006, when it fell 3.97%, according to Barron’s.

This year, the Nasdaq Composite has seen its biggest losses since March, when the index fell 4.8% following the outbreak of the war between the U.S. and Iran.

The biggest factor affecting the technology sector in July was the decline in chipmakers' stock prices. The Philadelphia Semiconductor Index plummeted 20% over the month, marking its worst performance since 2008.

The decline in chipmakers did not have as strong an impact on the other two major U.S. stock market indices. The broad-market S&P 500 index lost just 9 points (0.1%) in July and ended the month at 7,489.8 points. The Dow Jones Industrial Average, an index of blue-chip stocks, rose 0.3% over the month to 52,485.74 points.

Despite a difficult July, the S&P 500 remains close to its all-time high. “I find it encouraging that the market isn’t falling sharply, but has simply paused its upward momentum for the time being. The bull market is essentially taking a breather before making another attempt to climb higher,” Barron’s quotes Ryan Detrick, chief strategist at Carson Group, as saying. He added that a slight pullback following the S&P 500’s gains in April and May seems entirely natural.

This news story is being updated

This article was AI-translated and verified by a human editor