NEW YORK, June 23, 2026, 16:01 EDT
- The Dow barely moved, with the S&P 500 and Nasdaq both down hard as chip stocks and megacap techs dropped.
- Philadelphia Semiconductor Index dropped 7.6% as concerns over AI spending and expectations for higher rates weighed on chip stocks.
- Investors watch for Micron’s report and Thursday’s PCE inflation numbers, the Fed’s preferred price measure.
Dow ends near flat line Tuesday, holding up better than the wider market as losses in chip names and big tech pressured the S&P 500 and Nasdaq. Early close numbers show the Dow off 0.08% at 51,670.82. The S&P 500 dropped 1.42% to 7,366.87, and the Nasdaq Composite slid 2.04% to 25,632.46.
The gap is relevant now because the Dow isn’t set up like the Nasdaq. S&P Dow Jones Indices calls the Dow a price-weighted index of 30 U.S. blue-chips, so stocks with higher prices sway the index more than those with lower prices, no matter the company’s market cap.
AI stocks cracked. The Philadelphia Semiconductor Index dropped 7.6% and the S&P 500 technology sector slid 3.2%, Reuters said. Nvidia, Alphabet, Intel, Marvell Technology, and Advanced Micro Devices took losses.
Micron Technology and SanDisk, strong names this year, dropped sharply before Micron’s results due Wednesday. That report could offer investors a new look at memory-chip demand. “Some of the news lately about AI raises questions,” said Thomas Martin, senior portfolio manager at Globalt. He pointed to spending, capex and semiconductor supply as key issues. Reuters
Nasdaq led the drop, with the S&P 500 in the red too, while the Dow stayed mostly out of trouble. The Russell 2000 also finished down, MarketWatch data showed, so the move away from big tech didn’t mean investors were chasing smaller stocks.
Rate jitters weighed on the market. According to Reuters, traders ramped up bets on a second 25-basis-point Fed hike by December. That’s up from forecasts of just one hike two weeks ago. One basis point equals one-hundredth of a percentage point.
Technical signals were “stretched” on expectations, positioning and valuations, said Amanda Agati, chief investment officer at PNC Asset Management Group. Ross Mayfield, investment strategy analyst at Baird, said the move was “highly concentrated and flow-driven.” That’s left the trade exposed to changing sentiment, he said. Reuters
Oil failed to lift stocks. Brent crude slipped below $80 a barrel as more tankers moved through the Strait of Hormuz and the U.S. agreed to a 60-day waiver on Iran sanctions under an early peace deal, Reuters said.
Dow holds up but the warning signs are there. The CBOE Volatility Index—Wall Street’s fear gauge—jumped to its highest level in over a week. More stocks fell than rose on the NYSE and Nasdaq.
Technology stocks have been on a run, and analysts have warned a cool-off could be coming. “A period of consolidation is reasonable,” Brock Weimer, investment strategy analyst at Edward Jones, said in a note, the Associated Press reported. AP News
Traders are watching Thursday’s PCE inflation print for a possible upside surprise that could fuel more rate hike bets and push growth stocks lower again. A downbeat Micron outlook would add to questions over AI spending. But if inflation comes in lower, or chip demand shows up strong, the Nasdaq could bounce, narrowing the gap with the Dow.
