This content was published on
July 17, 2026 - 11:22
4 minutes
(Bloomberg) — Nasdaq 100 futures tumbled 2% as the global selloff in chipmakers gathered pace, with traders rushing to exit positions in stocks that had fueled this year’s rally but whose valuations grew increasingly rich.S&P 500 contracts were also under pressure, falling 1% as an exchange-traded fund tracking semiconductor firms dropped 4% in premarket trading. The rout spread throughout Asia, with Taiwanese stocks falling into a technical correction and the region’s main benchmark hitting a two-month low. The decline was more measured in Europe due to the region’s lower exposure to tech.Chipmakers are under growing scrutiny over whether massive gains fueled by the buildout of artificial intelligence have run too far to justify their elevated valuations. At the heart of the matter is whether the hundreds of billions of dollars in spending by AI hyperscalers will eventually deliver strong returns and sustain sky-high demand for chips.“When there’s panic, no one wants to be the last one in a selloff, so the selling pressure increases,” said Guillermo Hernández Sampere, head of trading at MPPM. “With the start of reporting, the suspicion of overvaluation has been confirmed and will continue for a bit.”Another day of attacks and counterstrikes in the Middle East also weighed on sentiment. Brent crude is heading for its biggest weekly gain since April, with the benchmark trading above $85 a barrel. Treasuries caught a bid despite the rise in oil prices, with the 10-year yield down three two points to 4.53%. The dollar wavered, while gold rebounded from a two-month low.Stock investors are taking profits in what had become crowded positions in chip-related stocks, with a key gauge of industry giants still up 68% this year. For Francisco Simon, European head of strategy at Santander Asset Management, the selloff still looks moderate in comparison to the preceding rally.“We would distinguish between fundamentals and positioning,” he said. “From a fundamental perspective, the picture remains solid: earnings momentum has been exceptional this year, and results are still coming in strongly.”Early US trading showed investors selling holdings across companies tied to the AI buildout. Nvidia Corp. dropped 3% to lead declines among the Magnificent Seven. Chip-equipment makers, neocloud, optical and energy names also fell sharply. Netflix Inc. tumbled 10% after a disappointing forecast.Cash would offer good protection in the near term, Simon said. Bonds are a less attractive option as higher oil prices could undermine the defensive characteristics of sovereign debt.“The key reassurance would probably come from the earnings season,” he said. “If companies continue to deliver solid results, and valuations become more attractive after the correction, that could help bring longer-term buyers back.”Corporate News:Netflix Inc. forecast a second consecutive quarter of slowing sales growth, contributing to investor anxiety about the streaming giant’s future. SpaceX said it will aim to launch its Starship rocket again in a few days after aborting Thursday’s mission when some of its engines didn’t fire up, sending shares lower. Germany is preparing core demands for possible discussions with UniCredit SpA over Commerzbank AG, according to people familiar with the matter, highlighting how Berlin’s focus is shifting from stopping the proposed takeover to shaping it. Some of the main moves in markets:StocksThe Stoxx Europe 600 fell 0.7% as of 10:16 a.m. London time S&P 500 futures fell 1% Nasdaq 100 futures fell 2% Futures on the Dow Jones Industrial Average fell 0.8% The MSCI Asia Pacific Index fell 2.8% The MSCI Emerging Markets Index fell 2.7% CurrenciesThe Bloomberg Dollar Spot Index was little changed The euro was little changed at $1.1439 The Japanese yen was little changed at 162.43 per dollar The offshore yuan was little changed at 6.7798 per dollar The British pound fell 0.3% to $1.3441 CryptocurrenciesBitcoin fell 1.9% to $62,870.03 Ether fell 2.2% to $1,830.11 BondsThe yield on 10-year Treasuries declined two basis points to 4.53% Germany’s 10-year yield was little changed at 3.13% Britain’s 10-year yield declined three basis points to 4.94% CommoditiesBrent crude rose 1.2% to $85.26 a barrel Spot gold rose 0.5% to $3,997.79 an ounce This story was produced with the assistance of Bloomberg Automation.–With assistance from Neil Campling and Subrat Patnaik.©2026 Bloomberg L.P.
