Nasdaq Index: Chip Selloff Deepens as Micron, AMD and Nvidia Slide

Asia Chip Selloff Hits Nasdaq Before the Bell

The semiconductor selling that started on Wall Street Monday went through Asia overnight and is coming right back. SK Hynix dropped 14.65%, Samsung lost more than 13% and South Korea’s Kospi fell 10.84% after trading was halted. Tokyo Electron fell nearly 11%, Kioxia dropped more than 18% and Taiwan’s TSMC closed down nearly 3%.

The damage is now showing up in U.S. premarket with Micron down more than 4%, AMD and Marvell off about 3% each and Nvidia lower roughly 1.2%. The AI spending debate that Alphabet started last week has gone global and Amazon, Meta, Microsoft and Apple reporting later this week are the only thing that can stop it.

Nasdaq-100 futures are down 0.73%. S&P 500 futures are off 0.1%. Dow futures are up about 86 points or +0.16%.

Asia Showed This Is Not a One-Market Problem

SK Hynix and Samsung are two of the biggest suppliers of high-bandwidth memory going into AI servers. When they drop 13% to 14% in a single session, the U.S. chip names that depend on the same spending cycle feel it immediately.

The hyperscalers spend the money. Nvidia sells the processors. SK Hynix, Samsung and Micron supply the memory. Equipment makers like ASML, Tokyo Electron and Advantest fill the rest of the chain. Investors are selling the entire chain, not one name.

Micron is trading on the weak side of its 50-day moving average at $957.32, confirming the trend remains down. The moving average and the main top at $1011.77 are resistance. A weaker opening Tuesday could drive the stock into its last main bottom at $804.00 and a break through that level puts the long-term retracement zone at $783.25 to $671.91 on the radar.

Reports that China is making progress in memory chips and immersion deep-ultraviolet lithography equipment are adding another layer of pressure. ASML fell more than 8% Monday and the concern is not just about near-term earnings anymore. It is about whether the competitive landscape is shifting underneath the valuation the market already paid.

Earnings Are the Only Thing That Stops This

Amazon, Meta and Microsoft report later this week with Apple also on the calendar. Their guidance determines whether the chip selloff becomes a deeper correction or resets before the next leg higher. If the companies keep raising capex plans without showing a clearer path to revenue, semiconductor sellers stay aggressive. If management can show AI spending converting into demand, margins and cash flow, the group stabilizes fast.

Lower oil has not helped and that tells you the problem. Brent is below $90 and the 10-year yield has eased toward 4.65% but chip stocks are still falling because this is not about rates or inflation right now. It is about whether the AI buildout can support the valuations attached to it.

Wednesday’s FOMC decision and Warsh’s press conference add another layer. A message that keeps September tightening expectations alive is one more headwind for the highest-valuation names in the market.

The Dow is holding because financials and industrials are not part of this trade. The Nasdaq is carrying all the weight because semiconductors are still the center of the growth story.

Daily September E-mini Nasdaq-100 Index Futures

September E-mini Nasdaq-100 Index futures are trading lower in the premarket session. Earlier in the session, the index hit an intraday low at 27839.50 before bouncing back. The index is in a five-day retreat, accelerating after breaking the June 9 bottom at 28512.00. This is now the nearest resistance.

Momentum is driving the trade early Tuesday with sellers likely setting their sights on the long-term retracement zone at 27142.25 to 26208.25. Inside this area is the 200-day moving average at 26967.23. To some, this may be considered a value area so don’t be surprised by a technical bounce if tested.

Daily September E-mini S&P 500 Index Futures

September E-mini S&P 500 Index futures are inching lower early Tuesday. Traders hit the E-mini Nasdaq-100 Index hard during the pre-market session. The benchmark index was able to survive a test of the July 23 main bottom at 7411.75. A sustained move under this level could trigger a further decline into the June 26 main bottom at 7357.25 and the June 11 main bottom at 7292.25. The latter is a potential trigger point for an acceleration into the 200-day moving average at 7128.53 and the long-term retracement zone at 7047.75 to 6895.25.

On the upside, the nearest resistance is the short-term retracement zone at 7493.00 to 7540.50 and the 50-day moving average at 7531.11.

Daily September E-mini Dow Jones Industrial Average Futures

September E-mini Dow futures are edging higher for a third session, following a successful test of the 50-day moving average at 51895 and a short-term retracement zone at 51882 to 51463.00.

On the upside, traders could face headwinds at a pair of 50% retracement levels at 52674 and 53000. The last minor top before the 53656 all-time high is 53113.

What to Watch

The chip selling went global overnight and the only reports that can stop it are landing later this week. Amazon, Meta, Microsoft and Apple have to show the market that the AI spending is producing returns. Tuesday’s consumer-confidence report and earnings from Coca-Cola, Corning and Boeing fill the calendar but the chip trade is the only story driving the Nasdaq lower.

The Nasdaq-100 broke below key support and momentum is pointed toward the long-term retracement zone and the 200-day average. The S&P 500 is holding above its July bottom but a break opens a path toward deeper support and its own 200-day average well below. The Dow is the outlier, edging higher for a third session after holding its 50-day average. The split between the Dow and the Nasdaq tells you exactly where the problem is and earnings are the only thing that fixes it.

More Information in our Economic Calendar.