Chipmaker Slump Drags Nasdaq 100 While Broader Market Holds

Trading on Friday delivered a sharp, concentrated drop rather than a market-wide retreat. Across the session, 39% of the top 1000 companies closed higher, 5 of the 11 sectors rose, and the S&P 500 ended -3.0% from its record peak. Even with trading in the index proxy reaching 180% of a typical day's volume, the selling was confined largely to semiconductor and hardware companies. It was a loud session that shook technology valuations, but one that left the wider market conditions intact.

The major indexes highlighted how narrow the pressure was. The tech-heavy Nasdaq 100 closed -3.5%, taking the largest losses from the semiconductor selloff. The broader S&P 500 finished -1.8%, with SPY closing at $755.72. The Dow Jones Industrial Average finished -1.1%, while the Russell 2000 closed -1.6%.

The selling originated in chip earnings and spreading caution around artificial intelligence capital spending. In its quarterly report, Intel Corporation forecast fourth-quarter revenue of $15 billion to $16 billion, while reporting highlighted cash-flow pressures and weakening personal computer demand. That guidance left Intel Corporation at -28.6% by the closing bell as Intel plunged 28.6%. The disappointment rapidly spread across the semiconductor space as investors questioned whether rising infrastructure spending on artificial intelligence would yield adequate near-term returns. NVIDIA Corporation finished -4.2%.

Sector performance showed that clear divide. Information Technology recorded -4.4%, making it the session's weakest group by a wide margin. Yet outside of technology, defensive and cyclical groups found steady support. Energy led the gainers, finishing +1.9%.

Underlying financial conditions showed no sign of systemic stress. High-yield credit spreads held steady at 3.26%. Equity swings picked up, yet the VIX ended at 17.2.