Tech Stocks Set to Bounce After $1.3 Trillion Rout on AI Jitters
US technology stocks are poised for a rebound on Wednesday after a two-day selloff erased nearly $1.3 trillion from Nasdaq 100 market cap, driven by renewed concerns over AI valuations.
US technology stocks are expected to rebound on Wednesday after a sharp two-day selloff erased nearly $1.3 trillion from the market capitalization of Nasdaq 100 companies, driven by escalating concerns over artificial intelligence valuations.
The selloff, which began Monday and extended into Tuesday, was triggered by a series of analyst downgrades and cautious commentary on AI-related stocks, particularly in the semiconductor and cloud computing sectors. Investors grew wary of stretched valuations after a prolonged rally in AI names, leading to broad-based profit-taking. The Nasdaq 100 fell over 4% across the two sessions, marking its worst two-day drop in months. For equities traders, the sharp reversal highlights the fragility of sentiment in a market heavily concentrated in AI-driven growth stocks. The rotation out of tech into defensive sectors such as utilities and consumer staples suggests a shift in risk appetite. Traders can monitor current pricing on NowPrice's stocks page for real-time updates on key tech names and indices.
Looking ahead, market participants will focus on upcoming economic data, including durable goods orders and weekly jobless claims, as well as any further commentary from Federal Reserve officials. The CBOE Volatility Index (VIX) spiked above 20 during the selloff, indicating elevated uncertainty. A sustained recovery in tech stocks may depend on whether AI-related earnings forecasts hold up in the coming quarters, with several major tech companies reporting next month.