A deepening selloff in semiconductor and artificial-intelligence stocks dragged global equities lower on Tuesday, June 23, as investors who had ridden a months-long rally began to question whether the chipmakers powering the AI boom had grown too expensive.
The Nasdaq-100 fell about 2.7 percent and the S&P 500 roughly 1.3 percent, both touching more than one-week lows, even as the Dow Jones Industrial Average held marginally higher on strength outside technology. The split underscored how concentrated the damage was in AI-linked names.
The carnage was sharpest in chips. Micron Technology sank about 11 percent ahead of its fiscal third-quarter earnings, Qualcomm fell close to 7 percent, Taiwan Semiconductor Manufacturing dropped around 5 percent and Nvidia shed roughly 6 percent in what analysts called an ugly session for the sector. The VanEck Semiconductor ETF, a proxy for the global industry, fell more than 6 percent.
The rout had begun in Asia. South Korea’s KOSPI plummeted 9.99 percent as foreign investors dumped chip shares, with Samsung Electronics and SK Hynix each tumbling more than 12 percent after regulatory signals suggested the sector’s rally had overheated.
Driving the reversal is a growing unease that valuations across AI hardware have run ahead of fundamentals, compounded by the mounting, debt-funded capital spending that hyperscalers and chipmakers are committing to data centers. Investors are increasingly scrutinizing whether that build-out will generate returns quickly enough to justify the prices.
A more hawkish tilt from the Federal Reserve added to the pressure, trimming expectations for near-term interest-rate relief and raising the discount applied to the long-dated earnings that growth stocks promise. The pullback follows a nearly three-month surge in riskier assets.
The technology weakness overshadowed an easing in energy markets, where oil prices fell as Washington granted Iran a 60-day license to sell crude internationally, raising expectations of fresh global supply. For equity investors, the message of the day was a reckoning over how much of the AI trade had been priced for perfection.