Tech Selloff Continues, Market Sentiment Deteriorates
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Feb 04 2026
0mins
Source: Benzinga
- Continued Tech Decline: The iShares Expanded Tech-Software Sector ETF (NYSE:IGV) fell for the seventh consecutive day, returning to levels last seen during the April 2025 tariff shock, indicating a severe lack of confidence in tech stocks.
- Nasdaq Index Drop: The Nasdaq 100 dropped 2.2% after a 1.7% decline on Tuesday, as investors aggressively rotated out of long-duration growth stocks into energy and materials, reflecting a risk-off sentiment in the market.
- Bitcoin Price Decline: Bitcoin (CRYPTO:BTC) slid 2.5% to around $73,000, marking its lowest level since early November 2024, fully erasing the post-Trump election rally, which highlights the risk-averse tone in the crypto markets.
- Palantir Stock Plunge: Palantir Technologies Inc. (NASDAQ:PLTR) tumbled over 12%, reversing part of Tuesday's 6.9% surge, indicating investor concerns about the company's outlook, which may impact its future financing and market performance.
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Analyst Views on AMD
Wall Street analysts forecast AMD stock price to fall
33 Analyst Rating
25 Buy
8 Hold
0 Sell
Strong Buy
Current: 518.090
Low
210.00
Averages
289.13
High
377.00
Current: 518.090
Low
210.00
Averages
289.13
High
377.00
About AMD
Advanced Micro Devices, Inc. is a global semiconductor company. The Company is focused on high-performance computing and artificial intelligence (AI). Its segments include Data Center, Client and Gaming, and Embedded. Data Center segment includes AI accelerators, microprocessors (CPUs) for servers, graphics processing units (GPUs), accelerated processing units (APUs), data processing units (DPUs), Field Programmable Gate Arrays (FPGAs), and Adaptive system-on-Chip (SoC) products for data centers. Client and Gaming segment includes CPUs, APUs, chipsets for desktops and notebooks, discrete GPUs, and semi-custom SoC products and development services. Embedded segment includes embedded CPUs, APUs, FPGAs, system on modules (SOMs), and Adaptive SoC products. It markets and sells its products under the AMD trademark. Its products include AMD EPYC, AMD Ryzen, AMD Ryzen PRO, Virtex UltraScale+, among others.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Improved Investor Sentiment: Trump's policy changes may enhance market sentiment towards energy stocks, particularly against the backdrop of a global economic recovery, prompting investors to reassess the investment value of the energy sector.
- Strategic Implications: Tightening the Iran deal terms could escalate geopolitical tensions in the Middle East, affecting the global oil supply chain, necessitating investor awareness of associated risks.
See More
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- New Export Controls: The U.S. Commerce Department has issued new guidance requiring Chinese-headquartered companies to comply with semiconductor licensing requirements even when operating abroad, effectively closing a significant loophole in export controls that could hinder Chinese access to advanced AI chips.
- Broad Impact: The new regulations apply to some of the industry's most advanced processors, including Nvidia's Blackwell and Rubin chips and AMD's MI350X products, indicating that Chinese firms may have acquired substantial quantities of high-end chips through overseas subsidiaries in recent years.
- Potential Market Size: Industry observers estimate that hundreds of thousands of units may have been shipped to Chinese-linked entities since May 2025, although the exact figures remain unclear, suggesting that this policy shift could have profound implications for the global semiconductor market.
- Strategic Implications: This policy adjustment reflects Washington's ongoing efforts to limit China's access to advanced computing hardware, aiming to slow down China's development in artificial intelligence and other strategic technologies, thereby ensuring U.S. technological leadership in the global competition.
See More
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- Export Restrictions Tightened: The U.S. Department of Commerce has issued new guidance requiring licenses for the export of advanced chips, including Nvidia's Rubin and Blackwell processors and AMD's MI350x, to Chinese entities, even if located outside China, potentially impacting the global supply chain of Chinese AI firms.
- Potential Impact Assessment: Reports indicate that hundreds of thousands of chips may have been exported to subsidiaries of Chinese AI companies in locations like Malaysia over the past year, highlighting challenges to U.S. efforts to restrict Chinese access to semiconductors.
- Policy Background: The Commerce Department's decision to not enforce the AI Diffusion rule announced in May 2025 created this loophole, which was intended to limit global access to AI chips, reflecting inconsistencies in policy that may lead to technology leakage.
- Market Reaction: Although Nvidia has received U.S. government approval to sell its H200 chips, no deliveries have been made due to lack of approval from Chinese officials, indicating escalating tensions in the high-tech sector between the U.S. and China.
See More
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- Export Policy Tightening: The U.S. Department of Commerce issued new guidance requiring licenses for advanced chips exported to Chinese entities, even if located outside China, thereby strengthening export controls on Chinese AI firms.
- Potential Impact Assessment: According to industry sources, hundreds of thousands of advanced chips from Nvidia and AMD may have been exported to subsidiaries of Chinese companies in places like Malaysia over the past year, significantly undermining U.S. semiconductor restrictions.
- Policy Background Analysis: This change stems from the Commerce Department's announcement in May 2025 that it would not enforce the AI Diffusion rule, which was intended to limit global access to AI chips, creating a potential loophole for Chinese firms.
- Industry Reaction: Technology expert Chris McGuire highlighted that this loophole allowed Chinese companies to purchase Nvidia Blackwell chips at scale without a license, although the new guidance does not require data centers to stop using these chips or cut off servicing.
See More
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- Market Share Growth: Arm Holdings has captured approximately 50% of the data center CPU market, bolstered by the widespread adoption of its efficient Arm architecture by top hyperscalers like Nvidia and Amazon, indicating a significant shift in competitive dynamics.
- Revenue Growth Outlook: Arm anticipates that its direct chip sales will reach $15 billion by 2031, potentially generating $7.5 billion in gross profit, showcasing a remarkable growth trajectory compared to its gross profit of $4.8 billion in 2025, reflecting strong future demand.
- Surging CPU Demand: As agentic AI workloads increase, the CPU-to-GPU ratio may shift from 1:4 to 1:1, highlighting the value of Arm's designs in meeting this demand, which further enhances its market position.
- Valuation Concerns: Despite Arm's stock tripling in value since the beginning of the year, its current P/E ratio stands at 159, prompting investors to carefully evaluate whether this high valuation is justified, especially given the disparity between the company's growth potential and market expectations.
See More
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- Tech Stock Surge: Since March 30, Micron, Intel, and AMD have surged 201%, 178%, and 163% respectively, vastly outperforming the S&P 500's 19.5% gain, highlighting the dominance of tech stocks in the current market rally.
- Market Structure Shift: Technology now constitutes 35% of the S&P 500, while other sectors lag behind, indicating that the rally is heavily reliant on a few stocks, which increases market vulnerability.
- Declining Economic Confidence: Despite the stock market's rise, manufacturing activity remains uneven, consumer confidence has plummeted, and spending has slowed in several categories, suggesting that the overall economic health is not improving in tandem with the market.
- Historical Context Comparison: The S&P 500 has recorded 10 previous nine-week winning streaks since 1945, but the current rally is primarily driven by tech stocks, lacking broad industry participation, which could impact future market stability.
See More
