US stock markets took a hit: the tech sector dragged the market into deep negative territory
10 June 11:16
The U.S. stock market ended trading on June 9 with mixed results: the S&P 500 and Nasdaq fell, while the Dow Jones managed to close in positive territory. The main factor weighing on the market was a renewed sell-off in tech stocks, which resumed after a brief rebound the previous day. This was reported by "Komersant Ukrainian", citing Reuters.
A statement by U.S. President Donald Trump regarding the need to respond to the alleged downing of an American helicopter by Iran near the Strait of Hormuz dealt an additional blow to investor sentiment.
At the close of the session, the Dow Jones Industrial Average rose 0.17% to 50,872.11 points, the S&P 500 lost 0.26% to 7,386.65, and the Nasdaq Composite fell 0.97% to 25,678.82.
The stock market reacted to both geopolitical tensions and renewed pressure in the technology sector, which had been one of the main drivers of growth in recent months.
The tech sector once again dragged the market down
Tech companies were the weakest performers of the day.
According to Reuters, the S&P 500 technology sector index fell by more than 4% during trading, while the Philadelphia SE Semiconductor Index dropped by as much as 8.6% before paring its losses. As a result, the tech index closed down 1.8%, and the semiconductor index closed down 1.9%.
Analysts attribute this to investors continuing to reassess risks in the overheated AI and chip sectors. An additional trigger for caution was Broadcom’s weaker-than-expected forecast, which, as early as the end of last week, undermined confidence in the continued growth of tech stocks.
Despite this, the semiconductor index is still up nearly 78.7% year-to-date.
Trump’s statement heightened jitters on Wall Street
A new wave of geopolitical tension has also exacerbated the market situation. Reuters reports that Donald Trump posted on social media about an American Apache helicopter allegedly shot down by Iran while patrolling the Strait of Hormuz, and promised a U.S. response. According to market strategists, it was this statement that added further momentum to the decline.
Against this backdrop, the Cboe VIX volatility index rose to its highest level since April 7, indicating growing fears among investors.
At the same time, Iran and Israel had announced the day before that they were ceasing attacks on each other, and the market had hoped for a de-escalation of tensions. Trump’s new statement dampened those expectations.
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Investors Await Inflation Data and SpaceX’s Debut
Another source of tension is the anticipation of new macroeconomic data. Data on U.S. consumer inflation for May is set to be released as early as Wednesday, which may reveal the extent to which rising energy prices due to the conflict with Iran are already impacting the U.S. economy.
In addition, SpaceX’s highly anticipated market debut is expected later this week. According to Reuters, the company aims to raise $75 billion at a valuation of $1.75 trillion.
This could be a record-breaking IPO and, at the same time, put additional pressure on the stock market, as investors fear excessive enthusiasm in the fast-growing tech sector.
What happened with other stocks
Among individual companies, Broadcom lost 1.1%, and Nvidia lost 0.2%. Ciena shares fell 5.9% following the announcement of the terms of its convertible debt offering.
Meanwhile, on the NYSE, the number of advancing stocks outnumbered declining ones by a ratio of 1.33 to 1, and on the Nasdaq, 1.05 to 1, indicating that the sell-off was particularly painful for specific sectors rather than the entire market without exception.
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