The AI chip trade is unwinding fast. Semiconductor stocks fell sharply on Thursday, extending losses from the previous session, as investors weighed the risk that stricter rules could slow data center construction, Yahoo Finance reports. The PHLX Semiconductor Index fell 8%, cutting its gain for the year to about 30%.
Qualcomm led the drop after a weak profit forecast. Arm fell after revenue guidance that disappointed investors, and Micron declined after pausing plans for a Taiwanese plant over labor disputes. AMD fell 12%, Sandisk 15% and Intel nearly 5%, according to Yahoo Finance.
NBC News reports that the Nasdaq 100 fell more than 6% by midmorning to a five-month low and the S&P 500 dropped 3.5%. Many Democrats who won on Tuesday have pledged to slow or halt AI data center construction, with Texas, Ohio, Michigan and Georgia seen as key markets. SanDisk, Western Digital, AMD, Seagate and Micron were the biggest losers.
