A global retreat from technology stocks that forced the Korea Exchange to halt trading Tuesday rolled through Wall Street and stayed there into the close, dragging the tech-heavy Nasdaq to a second straight loss while the rest of the market wobbled. The selling started with memory-chip makers and spread across the artificial-intelligence trade, as investors questioned whether the months-long run in chip stocks had outpaced what the companies can actually earn. Adding fuel was a research note from Bank of America warning of up to three interest rate hikes this year — a sharp break from the cuts traders had been counting on from the Federal Reserve under Chair Kevin Warsh.

By the closing bell, the damage was lopsided. The Nasdaq Composite sank about 2.2%, or roughly 580 points, to 25,587.04. The S&P 500 fell about 1.4% to around 7,365, giving back an early attempt to hold steady. The Dow Jones Industrial Average finished essentially flat, down just 45.87 points, or 0.09%, to 51,666.84, cushioned by steadier non-tech names. The small-cap Russell 2000 slipped 0.96% to 2,975.48, dropping back below the 3,000 mark it had crossed for the first time only a day earlier.

Market movers

Memory-chip maker Micron Technology led the rout, dropping more than 10% in its worst day since June 5, a day ahead of its quarterly results. The pain ran across the sector: Nvidia fell 3.2% to $201.97 and Taiwan Semiconductor dropped 5.2%, while Marvell Technology lost about 8% and Sandisk sank roughly 11%. The VanEck Semiconductor ETF, which tracks the global chip industry, fell 6.5%. Alphabet slid about 2%, extending a 5% drop the day before tied to the departure of two senior AI researchers.

Oracle fell about 2% after disclosing in a regulatory filing that it cut roughly 21,000 jobs — nearly 13% of its workforce — over the past year. AMC Entertainment plunged nearly 24% after the theater chain announced plans to raise $200 million by selling stock to pay down debt.

There were pockets of green. IBM rose more than 4% after JPMorgan upgraded it to “overweight,” and Accenture gained nearly 2% after boosting its share buyback by $2 billion. With money rotating into safer corners, Walmart and Johnson & Johnson each added about 2%. And SpaceX, which had briefly erased all of its post-debut gains, clawed back in the afternoon to finish slightly higher, snapping a brutal three-day slide.

Analysts pinned the swoon on more than valuations. Anna Macdonald, investment strategy director at Hargreaves Lansdown, said strong results from Broadcom had failed to deliver the upgraded outlook investors wanted, triggering a selloff that began in U.S. chipmakers and fed through to Asia overnight.

Commodities and volatility

Oil kept sliding as traders weighed Monday’s U.S.-Iran agreement on a 60-day roadmap toward a final deal, which eased fears of a supply shock. West Texas Intermediate crude traded near $73 a barrel. Gold, normally a refuge when stocks fall, dropped about 1.8% to roughly $4,127 an ounce as investors raised cash. The mood showed clearly in the CBOE Volatility Index, Wall Street’s “fear gauge,” which jumped nearly 13% to 19.51.

In the bond market, yields stayed elevated, with the 10-year Treasury near 4.50% and the 2-year Treasury at its highest level since early 2025, reflecting renewed concern about potential rate hikes. Bitcoin hovered near its low for the year.

The day ahead

The earnings spotlight swings to delivery giant FedEx, reporting after Tuesday’s close, alongside Cerebras Systems, posting its first results since its May IPO. The bigger test comes Wednesday night, when Micron reports and offers the clearest read yet on whether demand for AI memory chips can justify the prices investors have paid.

Later in the week, investors will focus on the government’s release of May PCE inflation data and a final estimate of first-quarter GDP on Thursday, both of which could shape expectations for the Federal Reserve’s next move.

JBizNews Desk | New York

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