Chipmakers and other high-flying stocks slide as AI trade wobbles

Global semiconductor and AI-exposed stocks sold off sharply, with the Philadelphia SE Semiconductor Index down around 11 percent this week — its largest weekly fall since March 2025 — and nearly 24 percent below its late-June all-time high, edging into bear market territory. Key chipmakers tumbled, including Nvidia down 3.4 percent, AMD sliding 4.9 percent and Applied Materials falling 6.5 percent, as investors questioned the sustainability of AI capex and digested concerns around Chinese AI startup Moonshot's new Kimi K3 model and delays in Alphabet's Gemini 3.5 Pro release. The sell-off spread globally, dragging South Korea's KOSPI into a bear market and Japan's Nikkei into correction, with the S&P 500 Momentum Index pulling back 10 percent in July against a 0.8 percent drop in the broader S&P 500.