WS #16335
The technology sector is facing a significant technical and fundamental breakdown. The QQQ has lost its six-month uptrend, with Meta suffering its third consecutive drop of more than 5% following earnings. Chip equipment stocks like Lam Research are plunging 10% despite beating earnings, as investors react to weaker forward guidance and Tesla's capex cuts. Analysts are increasingly warning that the AI trade is vulnerable to mounting credit risks, suggesting that the high-multiple growth narrative is losing momentum as capital costs remain elevated.
Tech Selloff and Credit Risk
The technology sector is facing a significant technical and fundamental breakdown. The QQQ has lost its six-month uptrend, with Meta suffering its third consecutive drop of more than 5% following earnings. Chip equipment stocks like Lam Research are plunging 10% despite beating earnings, as investors react to weaker forward guidance and Tesla's capex cuts. Analysts are increasingly warning that the AI trade is vulnerable to mounting credit risks, suggesting that the high-multiple growth narrative is losing momentum as capital costs remain elevated.