US Stock Market Declines Amid Broader Tech Sell-Off and Fading AI Enthusiasm
The US stock market experienced a decline on Tuesday, tracking the broader tech sell-off from previous sessions. Investors began to question the longevity of the AI boom, with attention shifting to upcoming earnings reports to gauge demand.
The S&P 500 fell by 1.4%, while the Nasdaq lost 3.3% and the Dow Jones dropped 0.1%. The VanEck Semiconductor ETF (SMH) plummeted 7% due to weakness in Micron, Broadcom, and Nvidia shares.
Investors await Micron's quarterly results on Wednesday, with BofA hiking its price target by 58% to $1,500 from $950 while maintaining a 'Buy' rating. Retail investors have shown significant interest in SpaceX stock, buying over $400 million of the company's shares during its first five trading sessions.
The decline in South Korean equities also fueled investor concerns that the recent tech and AI boom may be overblown. Chris Low at FHN Financial stated that 'the risk-off trade reflects fear AI exuberance may be overdone.'