At midday, the S&P 500 (^GSPC 1.44%) fell 1.06% to 7,393.73, the Nasdaq Composite (^IXIC 2.21%) sank 1.56% to 25,759.41 on an intensifying technology rout. The Dow Jones Industrial Average (^DJI 0.09%) edged up 0.09% to 51,758.04.
Gold prices fell 1.35% to $4134.70, and the 10-Year Treasury yield slid 0.03% to 4.48% as of midday. Technology stocks saw the biggest declines, while healthcare, consumer defensive, and utilities gained.
Today’s biggest moves
Sandisk tumbled over 12%, and Western Digital dropped 8% this morning as a sell-off in South Korean memory giants spread to U.S. chipmakers. Micron Technology dropped almost 11% on sector-wide concerns ahead of tomorrow’s earnings.
IBM bucked the trend, rising almost 5% following a JPMorgan upgrade. Walmart stock increased after the retail firm signed a 15-year nuclear power supply deal with Constellation Energy.
What this means for investors
Artificial intelligence (AI) jitters pressured stocks this morning as a global technology rout intensified. South Korea’s Kospi, which tracks the country’s largest firms, fell almost 10% when a combination of factors came to a head. AI valuation concerns met regulatory changes and forced liquidations, and the chip-heavy index saw its biggest drop in over three months.
Major U.S. indexes set new records this year, with tech strength powering new highs, even as inflation uncertainty grew and consumer confidence fell. It is important to view today’s pullback through that lens and focus on where these AI stocks may be in five to 10 years or more. Rate concerns are understandably driving risk-off sentiment right now, but that doesn’t mean that South Korea’s stock market plunge will be replicated in the U.S.
Emma Newbery has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Constellation Energy, International Business Machines, Micron Technology, Walmart, and Western Digital. The Motley Fool has a disclosure policy.
