{"id":485209,"date":"2026-06-05T22:20:07","date_gmt":"2026-06-05T22:20:07","guid":{"rendered":"https:\/\/www.newsbeep.com\/ie\/485209\/"},"modified":"2026-06-05T22:20:07","modified_gmt":"2026-06-05T22:20:07","slug":"big-fall-in-us-tech-shares-as-ai-stocks-are-hit-the-irish-times","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ie\/485209\/","title":{"rendered":"Big fall in US tech shares as AI stocks are hit \u2013 The Irish Times"},"content":{"rendered":"

US tech stocks tumbled on Friday in a sell-off led by chipmakers and memory groups after a strong jobs report sparked bets that the Federal Reserve<\/a> will raise interest rates by the end of this year.<\/p>\n

The S&P index, a wide measure of the US market, closed 2.64 per cent lower, puncturing a dramatic stock market rally that has been led by companies exposed to the AI capital expenditure boom. The technology-heavy Nasdaq Composite closed almost 4.2 per cent lower, its worst day since April 2025 just one week before the hotly anticipated listing of Elon Musk<\/a>\u2019s SpaceX, set to be the biggest initial public offering in history.<\/p>\n

The losses spread beyond the tech sector on Friday as the sell-off gathered pace, with declines for consumer cyclicals and basic materials groups after a hot US jobs report prompted fresh bets that the Fed will be forced to raise rates to cool the economy. Investors will now watch the opening of markets on Monday to see whether the trend continues.<\/p>\n

US government bonds sold off sharply after the jobs data, with the two-year yield moving 0.12 percentage point higher to a 15-month high of 4.18 per cent and closing just slightly lower.<\/p>\n

\u201cWith inflation moving higher and the labour market improving considerably, the Fed is unlikely to ease policy in 2026,\u201d said Raymond James chief economist Eugenio Alem\u00e1n.<\/p>\n

Arun Sai, senior multi-asset strategist at Pictet Asset Management, said that while much of the tech sector was relatively insensitive to interest rate rises, \u201cin the very near term, given how extended momentum is and how concentrated trades are, the Fed turning hawkish could be the biggest risk\u201d.<\/p>\n

\u201cWe are sitting on a massive momentum rally,\u201d he said, and higher interest rates \u201cwould damage\u201d that.<\/p>\n

US markets are braced for a wave of fresh equity supply ahead of SpaceX\u2019s IPO next week and potential listings for AI start-ups OpenAI and Anthropic, both of which are likely to fetch valuations of about $1 trillion.<\/p>\n

Alphabet\u2019s plans to raise up to $85 billion in equity to fund its AI infrastructure investments, the largest such raising on record, will add to the deluge. Meta is also weighing plans to raise tens of billions of dollars in a stock offering to fund its AI ambitions.<\/p>\n

Nerves about the market\u2019s ability to absorb the extra supply are likely to intensify if this week\u2019s sell-off persists. Meta\u2019s shares were down as much as 7 per cent following the report of its planned fundraising in the Financial Times.<\/p>\n

Chipmakers \u2013 the biggest winners of the recent rally \u2013 have fallen sharply after Broadcom failed to meet the most bullish revenue forecasts in its results after markets closed on Wednesday. The chipmaker\u2019s share price was down by about 8 per cent on Friday, adding to a 12.5 per cent fall on Thursday.<\/p>\n

The Philadelphia Semiconductor index fell 9.6 per cent on Friday, although it remains almost 80 per cent higher this year. Arm Holdings and Micron dropped more than 12 per cent, while Sandisk was down almost 9 per cent.<\/p>\n

The sell-off has been felt around the world, with South Korean chip giant SK Hynix falling 10 per cent on Friday. Samsung Electronics dropped 6 per cent.<\/p>\n

Analysts said the sell-off reflected the increasingly high bar for companies to impress investors after a stunning two-month tech rally. The S&P is down nearly 1 per cent since the start of the week, threatening to end a nine-week winning streak for the index.<\/p>\n

Jordan Rochester, a strategist at Mizuho, said the \u201cincredible move higher in stocks [was] probably due a drawdown\u201d.<\/p>\n

\u201cWhat truly ends the cycle is if the earnings growth takes a turn, or simply does not live up to elevated expectations,\u201d Rochester said, pointing to the Broadcom report. He said this \u201ccould be a one-off\u201d and was \u201cyet to be seen across the board\u201d.<\/p>\n

The narrowness of the rally has prompted alarm from some investors, who have noted the market is increasingly reliant on the tech sector to power earnings growth.<\/p>\n

\u201cEverything is really concentrated in this thematic,\u201d said Nicolas Forest, chief investment officer at Candriam. \u201cThis is the elephant in the room \u2013 if we have questions or disappointment around results on AI, it will be very difficult to stay positive on risky assets.\u201d<\/p>\n

Christian Raute, head of markets trading strategy at Citi, said that in the discussion about mega-IPOs, \u201cthe one big thing that everybody misses is the market context\u201d.<\/p>\n

\u201cIf the real world that week dislikes equities, [the IPOs] will create even greater disruption,\u201d Raute said. \u2013 Copyright the Financial Times Limited 2026<\/p>\n","protected":false},"excerpt":{"rendered":"US tech stocks tumbled on Friday in a sell-off led by chipmakers and memory groups after a strong…\n","protected":false},"author":2,"featured_media":485210,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[72,605,1961,61,60,7389,35477],"class_list":["post-485209","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-business","tag-elon-musk","tag-federal-reserve","tag-ie","tag-ireland","tag-nasdaq","tag-standard-poor-s"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/485209","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/comments?post=485209"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/485209\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media\/485210"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media?parent=485209"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/categories?post=485209"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/tags?post=485209"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}