The $3.3 trillion chip sell-off is nearing a bear market: Chart of the Day

The PHLX Semiconductor Index (^SOX) fell 4.3% on Thursday, breaking below its 12,000 neckline and a head-and-shoulders top pattern, leaving it less than 1% from a formal 20% bear market decline from its June high. Global chip stocks have erased approximately $3.3 trillion in market value since June 22, with the pain concentrated in memory stocks like Micron, Samsung, and SK Hynix, while Nvidia has remained nearly flat and outperformed the sector.

Why it matters: Unlike previous chip sell-offs that saw rotation into the Magnificent Seven, this downturn saw MAGS stocks fall alongside chips, with gains in transports, regional banks, and homebuilders — signaling a broader shift away from former market leadership, with 11,000 as the next technical target.