- The Nasdaq opened lower on Tuesday, dropping 161.0 points, or 0.62%, to 25,960.13, amid declining chip stocks and concerns over the AI-led rally's momentum, influenced by DeepSeek's AI chip development and Samsung's earnings.
- Samsung's post-earnings sell-off contributed to the pressure on the chip sector, with shares falling nearly 7% despite reporting a 19-fold increase in operating profit for the second quarter.
- Chip stocks were heavily impacted, with major players like Applied Materials down almost 10%, and AMD and Micron both sliding over 7%.
The Nasdaq Composite opened lower on July 7, falling 161 points, or 0.62%, amid a sell-off in chip stocks. This decline was influenced by Samsung's disappointing earnings and news that China's DeepSeek is developing its own AI chip, raising concerns about AI valuations.56
Despite Samsung reporting a 19-fold increase in operating profit for the second quarter, its shares fell nearly 7%, contributing to a broader sell-off in the semiconductor sector. Major players like Applied Materials and Intel saw declines of nearly 10% and 3.3%, respectively, as investors rotated out of AI and semiconductor stocks.
The chip sector was under heavy pressure, with AMD and Micron both sliding over 7%. Analysts noted that the market is sensing a peak in chip pricing, with Micron trading at around 7x forward earnings. This has led to increased volatility as investors unwind positions in a crowded market.
The Nasdaq's futures were down 1.1% ahead of the opening bell, reflecting a cautious sentiment among investors. The overall market mood shifted as concerns about AI valuations and the impact of new competitors like DeepSeek weighed heavily on investor confidence.
As the earnings season approaches, analysts warn of potential volatility, with the market remaining on a knife-edge amid fluctuating demand for AI technologies.
“DeepSeek's plans to build its own AI chip aim to cut reliance on Nvidia and Huawei, adding to market jitters. Samsung's 19-fold profit increase failed to impress, sending its stock down 7% and dragging the Kospi nearly 5% lower as chip stocks broadly sold off.”
Межа. Новини України.
