The Dow was down about 1% and the Nasdaq 100 nearly 3.7% in early afternoon. Chip and storage stocks fell hardest, and Nvidia fell less than most of its peers.
Friday's selloff was concentrated, not general.
By early afternoon the S&P 500's technology sector was down about 4.6%. The energy sector was up about 1.5%, health care and consumer staples about 0.8% each, and utilities about 0.6%. The result was a wide gap between indexes: the Dow Jones Industrial Average was down about 1% at 51,827 and the S&P 500 about 1.9% at 7,575, while the Nasdaq 100 fell about 3.7% and the Nasdaq Composite about 3.1%. The Nasdaq was on course for its worst day since June. The VIX rose about 4 points to 21.3.
Where it hurt
The PHLX Semiconductor index fell about 8.1%. Intel was down about 30% after its forecast, and the damage spread to companies tied to personal computers and memory. Dell and Qualcomm fell about 12% each, AMD and Arm about 11% each, and HP about 9%.
Storage companies fell as hard as chip designers. Seagate was down about 9.8%, Western Digital about 8.5% and Sandisk about 14.6%. Chip-equipment makers Applied Materials, Lam Research and ASML fell 7% to 8%.
The leaders of the AI trade held up better. Nvidia fell about 4.8%, Broadcom about 6% and Taiwan Semiconductor about 6.4%. The largest platform companies barely moved by comparison: Alphabet and Microsoft fell about 1.7%, Meta about 1% and Apple about 0.9%. Oracle fell about 6% and ServiceNow about 5%.
Where the money went
Energy led the gainers. ExxonMobil and Chevron both touched 52-week highs after their results, and refiners rose 2% to 3%. Regeneron and AbbVie rose in health care after their own reports, as did U.S.-listed shares of AstraZeneca, which is not in the S&P 500.
Three explanations
The market offers three readings, and the day's data cannot separate them. The first is a read-across from Intel's warning that memory prices are slowing PC demand, which fits the heavy losses at PC makers and memory companies. The second is a broader worry about AI spending and cash burn after Amazon's results, which fits the drop in chipmakers. The third is a rotation into defensive sectors ahead of the weekend, the midterm elections and a possible December rate hike, which fits the gains in utilities, staples and health care.
What to watch
The closing levels, month-end flows, the ISM manufacturing survey on Monday and next week's results from companies with direct exposure to PC and data center demand.