Chip Stocks Plunge as Philadelphia Semiconductor Index Drops 6.7%, Nasdaq Sheds 2.6%

Semiconductor shares led a sharp tech sell-off on Thursday, with the Philadelphia Semiconductor Index falling 6.72% and all 30 members closing lower. The Nasdaq Composite dropped 2.6% to 26,008.86 and the S&P 500 fell 1.2% to 7,663.43, while the Dow finished roughly flat at 52,867.98.

Lam Research slid about 11.8% on a warning about supply-chain constraints stretching into 2027, while Nvidia fell 4.4% and AMD about 8%. Meta dropped nearly 7% after disclosing roughly $825 billion in future commitments, adding to worries about the cost of the AI build-out.

The move is a notable headwind for AI-linked holdings such as Super Micro Computer, which had rallied earlier in the week. Investors will watch whether the sell-off extends or whether buyers return ahead of next week's Federal Reserve meeting.