Markets JUN 23, 2026

Nasdaq sheds 2.21% in second AI rout as investors demand proof over promises

Nasdaq closed at 25,587 Tuesday after a 580-point drop; Kospi tripped a circuit breaker at -10%, and Fed hike odds by year-end jumped to nearly 90%.

BY HENLEY MARRAST · MARKETS DESK

The Nasdaq Composite shed 579.56 points Tuesday, a 2.21% drop that closed the index at 25,587.04 and marked the second straight session in which the AI trade unwound without anything resembling a clean catalyst. The S&P 500 fell 1.44% to 7,365.47; the Dow held nearly flat, off 0.09% at 51,665.49, per Reuters data carried by Yahoo Finance. The divergence between the tech-weighted and industrial benchmarks is the story.

Overseas, the damage was structural. South Korea’s Kospi closed 10% lower, tripping a circuit breaker that forced a 20-minute cooling-off session, according to CNN. Samsung and SK Hynix, the two listings most directly geared to the global AI memory cycle, each fell more than 12%. Europe’s Stoxx 600 Technology index dropped 3.2%, with STMicroelectronics and ASMI both off more than 7%.

The US memory and accelerator complex followed the same script. Micron dropped more than 10%, its worst single-day decline since June 5. Sandisk fell 11%, Marvell shed 8%, Nvidia closed down 4.2%, and Broadcom slipped 3.1%. The VIX climbed 2.23 points to 19.52, a more than one-week high.

“Today’s big falls in tech stocks without any major catalyst are another illustration of rising volatility in these stocks, a result of what increasingly looks like frothy earnings expectations and/or valuations,” said James Reilly, senior market economist at Capital Economics.

Two narrative threads are doing the work. Alphabet posted its worst session since May 2025 on Monday, down roughly 5%, and slipped a further 0.8% Tuesday amid reporting on departures around Gemini co-lead Noam Shazeer and DeepMind’s John Jumper, a reminder that the talent war with OpenAI, Anthropic, Meta, and Microsoft is now legible to public markets. SpaceX, meanwhile, plunged 16% Monday after Bloomberg reported a planned $20 billion bond offering, recovering 1% Tuesday to close at $156.11. Capital-intensity, suddenly, is being priced as risk rather than ambition.

The macro overlay sharpens the move. CME Group data via LSEG now puts the probability of at least one Fed hike by year-end at nearly 90%, up from 57% a week earlier, with Kevin Warsh newly installed as Fed Chair and Thursday’s May PCE print waiting. This isn’t a vibe shift. It’s the moment investors started asking, out loud, where the AI earnings actually are.

Sources

About the author

Henley Marrast

MARKETS DESK

Henley Marrast covers AI-equity flow, accelerator demand, and earnings prints for AI Sheet Report. She leads coverage of the public AI complex from the New York markets desk, with a focus on the daily tape and quarterly results. She has been writing about technology markets for several years.