Tech selloff drags global stocks lower
Tech selloff drags global stocks lower
By Amanda Cooper and Chibuike OguhTue, June 23, 2026 at 7:36 PM UTC
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FILE PHOTO: The exterior of the Marriner S. Eccles Federal Reserve Board building is seen in Washington, D.C., U.S., June 14, 2022. REUTERS/Sarah Silbiger/File Photo
By Amanda Cooper and Chibuike Oguh
NEW YORK/LONDON, June 23 (Reuters) - Global stocks fell on Tuesday, dragged by a broad selloff in technology and semiconductor shares as investors kept taking profits on a long rally while bracing for more aggressive Federal Reserve action to fight inflation.
On Wall Street, the tech-heavy Nasdaq led losses, with semiconductor and some megacap stocks under pressure.
Nvidia fell 3.6% and Tesla dropped 5.7%. SpaceX shares reversed early declines to trade up 2.5%. Chip stocks were down 7.6%.
The Dow Jones Industrial Average was up 0.06%, the S&P 500 fell 1.2%, and the Nasdaq Composite fell 1.9%.
"If you look at the technical indicators, the SOX was at its most overbought level in the last three years so there's definitely an element of expectations getting stretched, market positioning getting stretched, and valuations getting stretched," said Amanda Agati, chief investment officer at PNC Asset Management Group.
European shares also declined, with the STOXX 600 down 0.73%, weighed by losses in semiconductor and chip-equipment makers. The weakness followed declines across Asia, where Seoul's KOSPI index plunged 10% in its sharpest one-day drop since March. MSCI's gauge of stocks across the globe fell 1.66%.
"This looks like a largely technical move, driven in part by profit-taking ahead of Micron's earnings," said Ross Mayfield, investment strategy analyst at Baird. "The trade has been highly concentrated and flow-driven, which makes it vulnerable to relatively small shifts in sentiment. In that sense, it doesn't appear to be closely tied to the fundamentals of the AI story, but rather to the heavy concentration and strong inflows into tech and global tech over the past few months now starting to unwind."
OIL REMAINS BELOW $80 A BARREL
Oil prices remained subdued, with Brent crude settling below $80 a barrel as tanker traffic through the Strait of Hormuz increased and physical market prices neared pre-conflict levels.
The U.S. agreed to waive sanctions on Iran for 60 days from Monday after the first round of talks under a nascent peace deal agreed last week on ending more than three months of war.
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While lower oil prices would typically support equities, investor focus has shifted to the inflation outlook and central bank policy. Markets now expect the Fed to take a firmer stance on inflation under Chair Kevin Warsh.
U.S. Treasury yields have surged in recent sessions, with 2-year yields — highly sensitive to rate expectations — hitting 16-month highs. On Tuesday, both 2- and 10-year yields were modestly lower on the day at 4.23% and 4.49%, respectively.
Money markets are now close to fully pricing in a rate hike by September, helping push the dollar index to one-year highs against a basket of currencies. The index was last up 0.37% to 101.38.
"The data to me does not suggest that they need to be raising rates. It suggests they need to sit on pause for a while and see if the Middle East-conflict-driven inflation data unwinds as a function of the negotiations and the deal," Agati said.
YEN AT 40-YEAR LOWS
The dollar's strength has weighed heavily on the Japanese yen, which hovered near 40-year lows at 161.56 per dollar. The euro slipped below $1.138 to its lowest level in a year as investors scaled back expectations for further European Central Bank tightening.
Japanese Finance Minister Satsuki Katayama said she discussed global financial markets with U.S. Treasury Secretary Scott Bessent on Monday, a move analysts said could signal rising risk of intervention to support the yen.
In Britain, the pound fell 0.40% to $1.3194 on the 10th anniversary of the Brexit vote. Sterling remained under pressure after Prime Minister Keir Starmer said he would resign, paving the way for what is expected to be a smooth political transition to Andy Burnham.
Gold also declined, falling 1.6% to $4,122.69 an ounce as higher rate expectations reduced the appeal of non-yielding assets.
In cryptocurrencies, bitcoin fell 3.21% to $62,310.38. Ethereum declined 4.29% to $1,658.42.
(Reporting by Chibuike Oguh in New York; Additional reporting by Jose Joel and Rocky Swift in Tokyo; Editing by Aurora Ellis and David Gregorio)
Source: “AOL Money”
