US Tech sell-off drives broader decline

Technology stocks led market declines as investors locked in profits amid monetary policy uncertainty and reports of potential U.S. government equity stakes in major chipmakers.

The S&P 500 fell 0.6% to 6,411.37, while the Nasdaq tumbled 1.5% to 21,314.95, driven by a broad selloff in mega-cap tech names. Nvidia plunged 3.5% in its steepest drop in nearly four months, while Palantir and AMD also declined sharply.

The Dow bucked the trend, rising marginally to 44,922.27 after hitting an intraday record.

Intel surged nearly 7% after SoftBank announced a $2 billion investment, signalling confidence in the chipmaker’s turnaround amid speculation of potential Trump administration backing. Home Depot jumped following Q2 results showing renewed U.S. same-store sales growth, alleviating housing market concerns, while investors now await Target and Walmart earnings for consumer spending insights.

The tech rotation follows months of AI-driven gains as investors await Federal Reserve policy signals from this week’s Jackson Hole Symposium. U.S. futures remained weak Tuesday evening, reflecting continued risk aversion.

Market participants remain cautious ahead of Fed Chair Jerome Powell’s Jackson Hole speech, seeking clarity on September rate cuts. Trump administration tariff uncertainty adds to investor hesitation despite strong Q2 earnings surprises.

China held benchmark lending rates unchanged for the third consecutive month, meeting expectations as authorities show no urgency for monetary stimulus despite recent weak economic data.

Indian markets posted modest gains on Tuesday, building on the previous session’s momentum as investors anticipated that recent GST reforms could help curb inflation and prompt additional rate cuts from the Reserve Bank of India. Market sentiment received further support from renewed diplomatic initiatives to resolve the Ukraine conflict and improve Sino-Indian relations amid global uncertainties.

The Nifty extended its winning streak to four consecutive sessions, advancing 103 points (0.42%) to close at 24,980, just below its intraday high. The broader market mirrored this positive trend, with both Nifty Midcap and Small-cap indices posting gains alongside the benchmark index.

Nifty is approaching its next resistance level at 25,160, representing the 61.8% Fibonacci retracement of the decline from the recent peak of 25,669 to the low of 24,337. On the downside, the 24,775-24,820 range, where the 20-day and 50-day DEMAs converge, is expected to provide support.

Indian markets are poised to open lower on the back of softer Asian cues, though we expect markets to find buyers at lower levels.

Disclaimer : This content is only for informational purpose. It does not make any decision to act or invest.

Source : HDFC Securities Prime Research