Wall Street opened mostly lower on Thursday as chipmakers extended their losses, pulling down the Nasdaq Composite and the S&P 500. According to Investopedia, the Dow Jones Industrial Average bucked the trend, lifted by shares of UnitedHealth Group.
The pressure on chip stocks came even as Taiwan Semiconductor (TSMC) reported strong results. Yahoo Finance reports the market fell after TSMC's earnings, while the broader selloff was tied to slumping South Korean peers. Shares of memory and AI-related stocks dipped again premarket, one report notes, after SK hynix and Samsung Electronics tumbled for a second straight day despite the strong TSMC numbers.
The weakness spread across the sector. Advanced Micro Devices (AMD) slid as chip-sector pressure overshadowed what one outlet described as record data-center growth and major AI GPU partnerships with OpenAI and Meta.
CNBC-TV18 reports that US stock futures traded mixed as investors weighed AI-driven optimism against rising geopolitical tensions in West Asia, with markets also awaiting key earnings and retail sales data. The Washington Post notes that AI stocks slumped again while oil prices kept climbing.
The pullback comes amid caution about how much of the market's rally rests on AI. One Wall Street analyst, identified as David, warned that a major crash could be coming and suggested Oracle could be among the first to fall — a reminder that much of the recent surge in US equities has been attributed to AI-driven gains.
Why it matters: AI and chip stocks have powered much of the market's climb, so when they wobble, the health of the entire rally comes into question.