Semiconductor Index Falls 11% in Worst Session Since March 2020
Key Facts
The SOX semiconductor index fell as much as 11% during the November 5, 2026 session, its worst performance since March 2020, according to Reuters. The selloff came as technology stocks faced broad pressure amid investors’ reassessment of the artificial intelligence trade. Mark Hackett of Nationwide said weak results from Qualcomm and Arm reminded investors of the importance of fundamentals. But he attributed the day’s main driver to “extremely heavy institutional selling and deleveraging by hedge funds and the most active institutional managers.” The decline also extended to the bond market, with some demand shifting to Treasuries.
The Nasdaq Composite fell as much as 5% during the same session, a level that would have confirmed its entry into correction territory, defined as a 10% decline from the peak recorded in October. The move came during a difficult month for AI stocks since the Nasdaq’s record close on October 6, according to Reuters. The losses showed pressure broadening from chipmakers to major technology stocks. Shares of more than a dozen large technology companies fell by more than 10%, including Advanced Micro Devices, Sandisk, Micron, Dell and Marvell Technology. The declines reflected a selloff that extended beyond chipmakers to companies linked to technology infrastructure spending.
Reuters said the selloff in stock and bond markets reduced the ability of several participants in data center construction to obtain financing. That adds financial pressure to concerns about the continued expansion of infrastructure needed for AI. The challenges were not limited to the cost of financing; the agency pointed to ballot initiatives approved in U.S. elections on Tuesday that could limit construction in the coming months and years. These factors leave data center construction plans facing potential constraints on financing and building. They do not, however, establish that specific capacity has been delayed or that permits have been broadly frozen.
Will Compernolle, an analyst at FHN Financial, said a shift away from chipmaker stocks was drawing demand into Treasuries. He put it this way: “There seems to be a shift away from chipmaker stocks, which is driving demand for Treasuries.” Compernolle linked the shift to questions about the path of AI investment after the midterm elections. Equity selling thus coincided with demand for government debt, indicating that some investors moved into more cautious positions during the session. The shift was part of the market’s reaction to the downturn in the chip sector.
In separate trading related to the name cited in the market account of infrastructure financing, SoftBank shares listed under the ticker SFTBY closed at $11.17 on November 5, according to EL7 data. SoftBank Group announced on September 9 that it would repay early the full outstanding balance of its bridge loans, amounting to $25.9 billion. The company set September 15, 2026, as the repayment date. The announcement provides background on the company’s financing obligations, but does not confirm a claim that it defaulted on turbine orders. The stock’s trading range during the session could not be verified from a reliable open source.
SoftBank is scheduled to report results for the second quarter of its 2026 fiscal year on November 10. The results cover the six-month period ended September 30, 2026, according to the company’s schedule. The announcement will provide investors with a near-term update on the group’s performance over that period. It follows a sharp decline in chip stocks and questions about financing for AI investment. The market movement on November 5 remains separate from any results that had not yet been announced.