Nasdaq Falls 1.98% on Iran Tensions and Chip Selloff, June 11

The Nasdaq Composite fell 1.98% to 25,169.50 on June 10 as geopolitical tensions and sector weakness hammered technology stocks. The broader market decline followed US military strikes against Iran and a consumer price index reading of 4.2%, signaling persistent inflation. Chip stocks led the selloff, with the iShares Semiconductor ETF dropping over 3% as investors rotated away from high-growth tech.

Market Selloff Driven by Geopolitical Risk

The Nasdaq Composite lost 509.32 points as President Trump threatened additional military action against Iran. The Dow fell 953.33 points, or 1.87%, to 49,918.78, while the S&P 500 dropped 1.62% to 7,266.99. Oil prices surged on the escalating tensions, with West Texas Intermediate crude futures rising 2.07% to $90.03 a barrel and Brent crude advancing 1.8% to $93.10. The conflict uncertainty pushed investors toward defensive positions and away from growth stocks.

Inflation Data Weighs on Tech Valuations

The consumer price index climbed 4.2% on an annualized basis in May, matching expectations but reinforcing concerns about sticky inflation. Higher inflation pressures central banks to maintain elevated interest rates, which reduces the appeal of expensive tech stocks that rely on low rates for valuation. Market data showed the US 500 index fell to 7,256 points, losing 0.15% from the previous session.

Chip Sector Collapse Accelerates Tech Decline

Semiconductor stocks suffered their fourth decline in five trading days, with the iShares Semiconductor ETF dropping over 3%. Shares of Micron Technology, Advanced Micro Devices, and Broadcom all fell as investors fled the sector. The chip selloff capped a brutal week that saw the SOXX ETF plunge 10% on Friday. Meyka rates the Nasdaq a C+ with a 12-month forecast of $22,613.65, suggesting limited upside from current levels.

What This Means for Your Portfolio

The Nasdaq’s weakness reflects a broader rotation out of expensive growth stocks into defensive sectors. With the RSI at 39.09 and the CCI at -161.99 (oversold), the index shows signs of short-term exhaustion. However, the 12-month target remains below year-to-date gains, indicating structural headwinds for tech. Investors should monitor oil prices and Iran developments closely, as further escalation could deepen the selloff.

Final Thoughts

The Nasdaq’s 1.98% drop reflects converging risks: geopolitical tension, sticky inflation, and a chip sector collapse. With Meyka rating the index a C+ and forecasting $22,613.65 by year-end, downside remains limited but upside is capped. Watch oil prices and inflation data for the next catalyst.

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The content shared by Meyka AI PTY LTD is solely for research and informational purposes.  Meyka is not a financial advisory service, and the information provided should not be considered investment or trading advice.