Trump just smashed the epic chip stock rally to pieces.
The Philadelphia Semiconductor Index, commonly known as the SOX Index, cratered 3.1% on Monday as Trump ratcheted up trade war rhetoric with key partners globally. It plunged below its key 50-day moving average in early afternoon trading and finished the session below the level.
Treasury Secretary Mnuchin tweeted that new investment restrictions, which had earlier been reported to target Chinese investors in the U.S., would instead apply to "all countries that are trying to steal out technology."
Viewed as a leading indicator by many market watchers, the SOX Index is comprised of 30 or so companies mostly involved in the design, distribution, manufacture, and sale of semiconductors.
Some of the hardest hit names in the SOX Monday were a who's who of 2018 tech momentum trades. Investors moved to unwind speculative bets in the richly valued space on fears of slowing tech equipment demand later this year thanks to trade tensions.
Top 5 SOX Index Laggards on Monday
- Micron Technology (MU) -7%
- Nvidia (NVDA) -5%
- Marvell Technologies (MRVL) -5.3%
- ON Semiconductor Corp. (ON) -4%
- Advanced Micro Devices (AMD) -4.3%
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