Nasdaq slides over 4% into correction as chip stocks are dumped

What happened

The Nasdaq dropped over 4% and moved into correction territory as traders sold chip stocks. Reporting tied the move to mounting concerns about spending on artificial intelligence.

Qualcomm slid 9% on Thursday morning following its fourth-quarter earnings report, leading a sell-off in semiconductor shares that has faced continued pressure since the election.

Why it matters

Semiconductor shares carry heavy weight in US technology benchmarks, so a concentrated sell-off in that group can pull the wider index with it. When the move is linked to questions about how much companies are spending on artificial intelligence, it touches the earnings story that has supported much of the index, which is why single-name results can spread across the sector.

Broad equity drawdowns also tend to travel. Risk-sensitive assets such as crypto often move with technology shares, while the dollar and gold can see flows as positioning shifts between risk assets and perceived safety. Political uncertainty after an election can add to the repositioning already under way.

What to watch

Further earnings from the chip sector and any company commentary on artificial intelligence spending plans, along with how post-election positioning in technology shares develops.