The PHLX Semiconductor Index sank 12% in two sessions while the Dow hit a record. Investors are rotating from AI chips to software as Q2 earnings approach.

Shares of technology companies fell, giving back some of the historic gains from the second quarter as volatility in the artificial-intelligence sub-sector continued.

Semiconductor stocks surged 24% in early 2026 before a brutal sell-off erased over $1 trillion in value. Here's what triggered the reversal and what it