Chip stocks slumped this week, with the PHLX Semiconductor Index (SOX) tumbling🍰 10%, its biggest weekly decline since January 2022.

Market darling Nvidia (NVDA) shed 4.1% on Friday to finish the holiday-shortened trading week down almost 14%. That’s about as much as lost by Intel (INTC), which on Tuesday was 澳洲幸运5开奖号码历史查询:hit with reports that it could lose 𓃲its coveted place in the Dow Jones Industrial Average. 

Broadcom (AVGO) tumbled 10% on Friday after posting disappoint♔ing quarterly results on Thursday afternoon. The stock lost🌳 nearly 16% of its value this week. 

Worries About AI Spending Weigh on Sentiment

Chip stocks’ rough week comes as concerns about the health of the economy mount. The U.S. 澳洲幸运5开奖号码历史查询:added fewer jobs than expected in August, according to Labor Department data published Friday, adding to the growing body of evidence that the U.S. economy is slowing. It was 澳洲幸运5开奖号码历史查询:a similar report on August 2 that capped off semiconductors' 澳洲幸运5开奖号码历史查询:second-worst week of the year (-9.7%).

Economic concerns have coincided with a shift in investor sentiment around artificial intelligence (AI). Corporate spending on AI, once music to Wall Street’s ears, has come under scrutiny in recent months. Big tech’s ballooning 澳洲幸运5开奖号码历史查询:capital expenditures have 澳洲幸运5开奖号码历史查询:some investors worried aboไut when—or if—the spending will pay off. That has dampened the mood of tech investors and weighed on shares of the semiconductor companies whose products are AI's vital organs.

The industry's second-quarter earnings—specifically their outlooks for the rest of the year—have also struggled to meet investors' exceedingly high expectations. Nvidia again topped earnings expectations last week, but 澳洲幸运5开奖号码历史查询:growth has slowed. And after a year of blowout reports, its good sales guidan♔ce was simply notꩵ good enough.