The Nasdaq fell 2%, with volatility hitting a two-year high: a look back at the day's sell-off in the tech sector

The Nasdaq Composite “tech” index fell by more than 2% at the close of trading on June 23. Three other major indices also declined: even the Dow Jones was unable to hold onto its slight gains. The sell-off of tech giants’ stocks intensified investors’ fears that the hype surrounding artificial intelligence may have gone too far, according to Bloomberg. The decline in SK Hynix’s share price on the South Korean market dragged down shares of U.S. memory manufacturers and chipmakers in general. Treasury bonds rose in price as the dollar strengthened to a one-year high.

— The Nasdaq Composite technology sector index plummeted 2.22% over the course of the day. For the sixth consecutive day, it moved by more than 1% (up or down): this is the index’s longest streak of volatility since August 8, 2024, Barron’s reports, citing data from Dow Jones Market Data. Moreover, the index has fallen by 1% or more on four of the last five days—a pattern not seen since February 27, 2025, the publication notes.

— The S&P 500 broad-market index fell 1.44% on June 23.

— The Dow Jones Industrial Average, a "blue-chip" index, fell 0.09% on Tuesday. During the day, the Dow recovered its losses and even rose, but by the close, it was unable to stay in positive territory.

— The Russell 2000 Small- and Mid-Cap Index fell by nearly 1%.

— The VIX volatility index closed at 19.6 points, up 13% for the day. Twenty points is considered a psychological threshold indicating high market volatility.

— Brent crude oil futures fell by about 1%, to $77.2 per barrel. The price of WTI fell by the same amount—to $73.2 per barrel. This is the lowest oil price since March 2—the first trading day after the start of the war between the U.S. and Iran.

— The dollar strengthened by 0.38% against a basket of other world currencies. This is the highest level in more than a year.

— The price of gold fell 2% to $4,100 per ounce.

— Bitcoin fell 3% to $62,300.

The sell-off in the technology sector, which began on Monday, gained momentum over the past 24 hours: Asian markets slumped sharply following a drop in shares of memory chip manufacturers, according to CNBC. SK Hynix shares in South Korea plummeted 12%, while Samsung Electronics shares fell nearly 10%. Following this, shares of U.S. chipmakers also fell sharply during trading on June 23: Micron Technology and SanDisk shares dropped 13%, Seagate Technology shares fell 5%, and Western Digital shares declined 8.5%. The Roundhill Memory ETF, which tracks stocks in the sector, plummeted by 14.3%.

Intel and AMD shares fell 6%, Qualcomm shares fell 8%, Broadcom shares fell 3%, and Nvidia shares fell 4.1%. The State Street Technology Select Sector SPDR ETF fell 4%, and the VanEck Semiconductor ETF dropped 7%. Alphabet shares also continued to decline, losing another 1% on Tuesday after falling 5% on June 22.

SpaceX shares rose 1% on Tuesday after falling for three consecutive trading sessions. The company issued $25 million in bonds, Bloomberg and CNBC reported, citing sources. This is SpaceX’s first bond offering, which the company organized less than two weeks after its record-breaking IPO, in which it raised $75 billion. SpaceX paid a relatively high premium compared to U.S. Treasury bonds to arrange the deal, according to Bloomberg sources.

The tech sector’s pullback comes at the end of the first half of the year, which has generally been marked by impressive growth driven by easing geopolitical tensions, strong corporate earnings, and a focus on AI, according to Bloomberg. On the other hand, the tech rally began to falter amid investor doubts about whether the multibillion-dollar spending by hyperscalers on AI would pay off, the agency notes.

— “It’s the AI beneficiaries that have been hit by the sell-off. I don’t think these stocks are expensive, but they’re overly popular,” said Andrew Slimmon, senior portfolio manager at Morgan Stanley Investment Management, on CNBC’s “Squawk Box” on Tuesday. — “When so many investors are pouring money into the same idea, sell-offs occur when the trend reverses, as is happening now. I’d say this is a healthy reaction.”

— “Sharp reversals and extreme price swings indicate that there are currently investors in the market who are ready to both buy and sell stocks,” Frank Cappelleri, founder of CappThesis, told Barron’s. At the same time, the analyst views this volatility as a sign that investors are beginning to question the rally that has driven the market on the back of enthusiasm surrounding AI. “At the very least, investors may be wondering whether this strong growth has run its course in the short term,” he noted. “Therefore, if the market does not continue to rise, such extreme intraday swings will persist, creating a challenging trading environment.”

— “For serious warning signs to emerge, the U.S. market would have to weaken significantly more than it has so far,” Bloomberg quotes Matt Mealy, chief market strategist at Miller Tabak, as saying. At the same time, the analyst noted that “given the volume of leveraged positions in South Korea and around the world, investors should not be overly complacent.”

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