The Nasdaq Composite fell 0.98% on Tuesday as chip stocks retreated after a brief rally, with the tech-heavy index paring losses of as much as 3.7% during the session as investors rotated out of semiconductor shares and geopolitical tensions weighed on sentiment.
The S&P 500 declined 0.3% while the Dow Jones Industrial Average rose 0.14%, according to Reuters. Shares of semiconductor leaders including Marvell Technology, Arm Holdings, Qualcomm, and Advanced Micro Devices all sold off, with the iShares Semiconductor ETF finishing nearly 2% lower, as Investopedia reported.
The pullback followed Broadcom’s disappointing forecast on June 3, when the chipmaker guided for AI semiconductor revenue well below investor expectations. That earnings miss triggered a sharp rotation out of the semiconductor sector, which had rallied more than 70% year to date, according to Reuters.
Geopolitical risk added another layer of selling pressure. President Donald Trump wrote on social media that Iran had shot down a U.S. Apache helicopter patrolling the Strait of Hormuz overnight and vowed to respond, according to Reuters. That announcement created “another leg down” in the market, said Michael O’Rourke, chief market strategist at JonesTrading, as investors worried about a broader conflict that could disrupt oil supplies and inflation expectations.
“When the bounce ran its course this morning, the tape came for sale more broadly,” O’Rourke told CNBC, noting that profit-taking and a momentum unwind in the semiconductor sector were the primary drivers of Tuesday’s decline. The Philadelphia SE Semiconductor Index dropped as much as 8.6% intraday before recovering somewhat, according to Reuters.
Nancy Tengler, CEO and CIO of Laffer Tengler Investments, noted in written commentary that “the NASDAQ may have delivered a good chunk of it in one session between Friday and today,” referring to a potential correction. She cautioned that while some call it a rotational move, “the Summer Swoon has arrived, which means volatility will be with us for the near-term,” according to Investopedia.
Sources
- Reuters — Nasdaq Composite and S&P 500 declines on June 9, 2026; semiconductor sector weakness; Trump’s Iran statement impact; semiconductor index year-to-date performance
- Investopedia — Nasdaq Composite and S&P 500 closing levels; intraday losses; chip stock declines; analyst commentary from Nancy Tengler
