Technology is seeing a sell-off, but artificial intelligence is still likely to lead the markets

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Technology drags the Nasdaq down
It was the American markets The two are mixed. the Standard & Poor's 500 and Dow Jones Industrial Average rose, but Nasdaq Composite It fell amid a widespread technology sell-off. Mostly Asia Pacific markets Trading higher on Tuesday. China's CSI 300 index rose by about 2.7% and in Hong Kong Hang Seng Index He added 2.3%. Japan Nikki 225London Stock Exchange data, the only outlier, showed a decline of almost 2% as the 40-year government bond yield rose to 2.766%, its highest level ever since 2007.

Potential new supply for US steel
cleveland cliffs It is a partnership with a competitor Nocor In a Potential bid to United States steelwhich was acquired by Japan Nippon Steel It was banned by the White House earlier this month, sources told CNBC's David Faber. The offer will be at a high stake of $30. Nippon had planned to buy US Steel for $55 per share in a deal worth more than $14 billion.

China's electric car boom will slow in 2025: HSBC
China's sales of new energy vehicleswhich includes battery-only cars and hybrid cars, will grow by just 20% in 2025, according to forecasts. HSBC Analysts. This represents a sharp decline from the 42% growth in 2024, according to data from the China Passenger Car Association. The penetration of new energy vehicles in new cars sold exceeded 50% by the second half of the year, according to the association.

Export restrictions for additional chips
The United States will impose New export restrictions On Monday, the US government announced artificial intelligence chips, depending on the level in which countries are classified. For example, close US allies will not face restrictions in access to AI chips. Nvidia, the largest supplier of artificial intelligence chips, called the rule a “massive overreach” on Monday.

Elon Musk acquires the American TikTok?
The Chinese government is studying a plan for this TikTok's US operations sold to Elon MuskBloomberg News I mentioned Monday, citing anonymous sources. This will allow TikTok to continue operating in the country if the US Supreme Court decides to uphold the law that would do so Chinese-owned TikTok has been effectively banned in the US.

(PRO) Opportunities outside the “Great Seven”
The “Great 7” stocks led most of the S&P 500's 23% return in 2024. While the portfolio manager expects these stocks still have room to rise this year, he advises investors to be selective within the “Great 7” stocks – and sees Opportunities in technology stocks are outside that basket.

The Nasdaq Composite Index, which is dominated by technology stocks, lost 0.38%. Big technology names are popular with investors It fell broadly in Monday's session. Palantir – the High performing stocks In the S&P last year – down 3.4%, while Nvidia lost 2%, building on its losses from last week. Nvidia shares fell nearly 6% during the period, while Palantir lost more than 15%.

“This is a necessary part of the corrective phase in our view, and we are more likely to continue this correction than many investors realize since many stocks peaked in late November and early December,” said Greg Bassuk, CEO of AXS Investments, adding that the report Jobs on Friday “reinforced” those concerns.

However, the S&P 500 rose 0.16% and the Dow Jones Industrial Average rose 0.86% as investors shifted to non-technology stocks such as Amgen, Caterpillar and UnitedHealth.

This doesn't mean that these segments will take the mantle of market leader any time soon – or at all. Sector rotation is a common phenomenon in the markets, as investors lock in their returns and look for the next stock with upside potential. and Against the backdrop of high interest rates It puts more pressure on growth-oriented technology stocks than value stocks, which typically make up the Dow Jones.

Moreover, the AI ​​craze is far from over, judging by the latest Profits Reports from TSMC and Foxconn, which trades as… Hon Hai Precision Industry. The two companies witnessed a boom in their revenues due to the high demand for products related to artificial intelligence.

There is unlikely to be a long-term rotation away from technology and AI. But one cannot be ruled out inside the field.

— CNBC's Samantha Sobin, Hakyung Kim and Brian Evans contributed to this report.