Tech Selloff Reverberates Through Global Markets
0h ago|4 min readStandard
Fazen Markets Editorial Desk
Collective editorial team · methodology
tech-selloffartificial-intelligence-stocks
Fazen Markets Editorial Desk
Collective editorial team · methodology
Trades XAUUSD 24/5 on autopilot. Verified Myfxbook performance. Free forever.
Risk warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. The majority of retail investor accounts lose money when trading CFDs. Vortex HFT is informational software — not investment advice. Past performance does not guarantee future results.
A global selloff in technology equities on Tuesday, June 24, renewed concerns that the artificial intelligence-driven rally has overextended. The pressure was evident in Intel's stock, which traded at $132.28 after declining 1.28% during the session. The selloff reverberated into Asian trading hours, where indices attempted a cautious rebound from the losses. Bloomberg reported the initial selloff, which highlighted growing investor apprehension over stretched valuations in the sector.
The current selloff echoes prior periods of tech-driven market stress, most notably the September 2025 retreat where the Nasdaq Composite fell 8% over two weeks. That episode was also triggered by valuation concerns following a multi-quarter rally. The current macro backdrop features elevated Treasury yields, with the 10-year note hovering near 4.5%, which increases the opportunity cost of holding growth stocks with distant earnings projections.
The immediate catalyst for this specific bout of selling appears to be a combination of profit-taking and position trimming ahead of key quarterly earnings reports. After a strong first half of 2026, institutional portfolios have become heavily weighted toward mega-cap technology names, making them vulnerable to a rapid unwind. The concentration of gains in a handful of AI-related stocks has created a fragility that is susceptible to any shift in sentiment.
Intel Corp. (INTC) serves as a key barometer for the selloff's intensity. The stock price declined to $132.28, a drop of 1.28% from the previous close. Intel's trading range for the session was wide, between $128.35 and $137.98, indicating significant intraday volatility and pressure. This performance notably underperformed the broader S&P 500 index, which experienced a more modest decline.
The selloff was not isolated to a single name but reflected a broader risk-off shift away from high-growth segments of the market. The Nasdaq 100 index futures pointed to a lower open, confirming the pressure was sector-wide. Market breadth metrics showed declining issues outnumbering advancers by a ratio of nearly 3-to-1 during the peak of the selling activity. Trading volume in tech sector ETFs surged 40% above the 30-day average, confirming the institutional nature of the flow.
The selloff's second-order effects are likely to pressure semiconductor capital equipment firms and cloud software providers that have benefited from the AI investment cycle. Stocks like Applied Materials and Snowflake often move in correlation with Intel and other chipmakers during risk-off rotations. Conversely, defensive sectors such as utilities and consumer staples may see inflows as capital seeks shelter from equity volatility.
A counter-argument to the bearish narrative is that the selloff represents a healthy correction rather than the start of a prolonged downturn. Fundamental demand for AI infrastructure remains strong, as evidenced by record capital expenditure guidance from major cloud providers. This view holds that the long-term growth story for AI remains intact despite short-term valuation air pockets.
Positioning data indicates that hedge funds were net sellers of technology shares during the session, while retail investor flows were more mixed. Options market activity showed a sharp rise in purchases of short-dated put options on the Technology Select Sector SPDR Fund (XLK), suggesting traders are hedging against further near-term downside.
The immediate focus for traders is the release of the U.S. Core PCE Price Index data on June 27. As the Federal Reserve's preferred inflation gauge, this print will heavily influence interest rate expectations and, by extension, the valuation framework for growth stocks. Any significant deviation from forecasts could amplify the current market volatility.
Technical levels for the Nasdaq Composite will provide critical signals. A break below the 18,500 support level, which held during the May selloff, could trigger further algorithmic selling. Conversely, a rebound above 19,200 would suggest the correction has found a floor. Intel shares face immediate resistance at the $135 level, which corresponds to its 50-day moving average.
Earnings season begins in earnest with reports from major banks on July 14, which will set the tone for second-quarter corporate profitability. Guidance from technology leaders regarding AI revenue monetization will be particularly scrutinized for signs of either validation or disappointment relative to current lofty expectations.
The selloff was primarily driven by profit-taking after extended gains in AI-related stocks, combined with concerns about stretched valuations. The pressure was exacerbated by institutional position trimming ahead of key economic data releases, particularly the PCE inflation report. Rising Treasury yields also made growth stocks less attractive relative to fixed income alternatives.
The June 24 selloff appears less severe than the 8% decline experienced by the Nasdaq in September 2025, which was driven by actual earnings disappointments from several tech giants. The current decline more closely resembles the 5% correction in March 2026, which was also valuation-driven and proved temporary as fundamental demand for AI products remained strong.
Investors should monitor sector rotation patterns to identify where capital is flowing, typically toward defensive sectors or value stocks. Volume patterns are crucial—high volume on declines suggests strong conviction behind selling. Finally, watch credit spreads for signs of stress in corporate financing conditions, particularly for technology companies that rely on debt markets for funding.
The tech selloff reflects healthy profit-taking in an overextended sector rather than a fundamental breakdown in AI demand.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. CFD trading carries high risk of capital loss.
Vortex HFT is our free MT4/MT5 Expert Advisor. Verified Myfxbook performance. No subscription. No fees. Trades 24/5.
Trade 800+ global stocks & ETFs
Start TradingSponsored
Open a demo account in 30 seconds. No deposit required.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.