The PHLX Semiconductor Index plummeted 4.3%, reflecting a broader loss of momentum for the sector. Market heavyweights including Intel, AMD, Micron, Seagate, and Sandisk all saw their valuations slide as the selling pressure intensified throughout the session. This retreat overshadowed the broader market's mixed signals, where 1,515 advancing issues on the NYSE slightly outnumbered the 1,215 decliners despite the downward pressure on major benchmarks.
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Semiconductor Sell-Off Triggers Market Retreat
The AI-fueled rally hit a wall Thursday as a sharp decline in semiconductor stocks dragged major U.S. indices lower. Despite record-breaking earnings from Taiwan Semiconductor Manufacturing and a solid performance from UnitedHealth, investors pivoted toward profit-taking, leaving the Nasdaq Composite to suffer a 1.47% drop by the closing bell.
Institutional sentiment appears to be shifting. Goldman Sachs reported that hedge funds have reduced their net exposure to artificial intelligence-related assets to the lowest point this year. This move by large-scale investors suggests a strategic effort to secure gains following an extended period of aggressive growth, signaling that the market's previous obsession with AI is entering a more cautious phase.
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