Markets
The Nasdaq's Worst Week Since June: Down 4.5%, With the Chip Index Off 11% in Five Days
The Nasdaq fell 2.15% on October 16 to 26,140.03 and 4.48% for the week, its worst since late June, as chip stocks fell for an eighth straight day. The Philadelphia Semiconductor Index lost 3.83% on the day and 11.41% on the week, while the Dow actually ended the week 0.67% higher.
Friday did not bring the relief Thursday had hinted at. The S&P 500 lost 1.09% to 7,659.44, the Nasdaq Composite 2.15% to 26,140.03 and the Russell 2000 1.66% to 2,721.37, while the Dow slipped just 0.34% to 52,002.41. For the Nasdaq it was the heaviest one-day fall since June 5 and the end of a month-long run of weekly gains: down 4.48% since October 9, its worst week since late June. The S&P 500 lost 1.95% on the week and the Russell 3.05%. The Dow finished the week up 0.67%.
That five-point gap between the Dow and the Nasdaq in a single week is the story. Everything connected to building AI capacity was sold, and everything that pays a dividend and burns no cash was bought. Technology, the largest sector, fell 3.02% on Friday alone; energy rose 2.52%, utilities 1.34% and consumer staples 1.08%, and the financial-sector ETF added 0.45% after two regional banks beat estimates.
The chipmakers did the most damage. The Philadelphia Semiconductor Index fell 3.83% to 11,137.29, its eighth consecutive decline, and 11.41% for the week, the steepest weekly loss since April 2025 according to Reuters. The VanEck Semiconductor ETF (SMH) dropped 3.41% to $539.79, a ninth straight loss that leaves it 14.8% below its October 5 close. AMD lost 5.95% (13.05% on the week), Micron 5.63%, Intel 5.79%, Broadcom 4.52% and Arm 6.94%; the equipment makers Applied Materials, Lam Research and KLA each fell between 4.8% and 5%. Nvidia, down 1.43% to $214.13, was the relative survivor, and it still lost 6.61% in five sessions. The triple-leveraged SOXL fell 12.74% on Friday and 32.98% for the week.
The reasons stacked up rather than arriving at once. Tuesday's and Wednesday's hot inflation reports raised the odds of another Fed hike; Wednesday's near-15% yield on CoreWeave's bonds turned the AI build-out into a credit question; Thursday brought a record quarter from TSMC that the market ignored; Friday added oil above $100, a VIX that briefly topped 22 and a hedge-fund rumour nobody could confirm. None of it was new by the close, which is what made the selling look like positioning being cut rather than a reaction to one headline.
The week ahead gives the market something concrete to trade: Netflix reports on Monday evening, Tesla and Meta on Wednesday, with the Fed's October 28 decision after that. Monday is also the 39th anniversary of the 1987 crash, a date that means nothing for prices and everything for the mood of a trading floor that has just watched chip stocks fall for eight days in a row.