Semiconductor stocks drag global equities lower for a third day while oil prices rise amid escalating U.S.-Iran conflict disrupting energy supplies.
World stock indexes fell sharply as semiconductor shares extended declines, with the Philadelphia semiconductor index dropping over 2% and trading 23.5% below its June 22 record high. Investors pulled back from AI-related stocks amid concerns over elevated valuations and the sustainability of capital spending growth in the sector.
The sell-off marked the third consecutive day of losses for chip stocks, contrasting with gains in defensive sectors like utilities and government bonds. Energy stocks advanced as oil prices climbed, driven by heightened geopolitical risks in the Middle East after U.S. and Iranian forces targeted key infrastructure.
In the Strait of Hormuz, U.S. Marines boarded a tanker, and another vessel was reportedly struck by a projectile, further tightening global energy supply concerns. The shift toward defensive assets underscored investor caution amid the dual pressures of tech sector volatility and geopolitical instability.