The Nasdaq 100 index deepened its decline during Wednesday’s trading session, falling 1% as technology stocks led a broader market retreat. The benchmark’s underperformance reflects growing risk aversion among investors amid renewed concerns about corporate earnings and economic growth prospects.
The selloff extends recent volatility in US equity markets, with megacap technology companies particularly vulnerable to shifting sentiment. Market participants appear to be reassessing valuations after this year’s strong rally, with some profit-taking emerging as the second quarter draws to a close.
Sector Rotation Accelerates Amid Economic Uncertainty
Analysts observe that the tech-heavy index is facing headwinds from multiple directions, including rising Treasury yields and potential regulatory challenges. The weakness follows mixed economic data that has clouded the outlook for Federal Reserve policy, creating uncertainty about the timing of potential interest rate cuts.
Trading volumes remain elevated as institutional investors adjust portfolios ahead of the quarter-end. The market’s next directional move may depend on forthcoming inflation data and corporate guidance, with particular attention on whether the current pullback represents a healthy correction or the beginning of a more sustained downturn. Sector rotation appears to be accelerating, with defensive stocks showing relative strength while growth-oriented names lag.
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