The sell-off in semiconductor equities intensified Thursday, driven by a collision between hotter-than-expected inflation data and mounting concerns over the debt-heavy balance sheets of AI infrastructure firms. Shares of Nvidia (NVDA) declined 2%, while Advanced Micro Devices (AMD) dropped 4%, extending a broader global downturn in the chip sector.
The pressure on memory stocks proved particularly acute. Sandisk (SNDK), the top performer in the S&P 500 (GSPC) for 2026, tumbled 6%, adding to a 5% loss from the previous session. Micron (MU) sank 4%, and SK Hynix (SKHY) also fell, deepening prior losses amid worries about competition from Chinese manufacturers.
Even strong corporate results failed to stabilize sentiment. TSMC (TSM), the world's largest contract chip manufacturer, reported positive earnings and record profits, yet its shares still declined 4%. The market reaction suggests that macroeconomic headwinds are currently overriding individual company performance.
A key driver of the anxiety is the rising cost of capital for companies carrying significant debt. September's wholesale inflation rose at its highest pace since 2022, fueling fears of higher lending costs and influencing expectations for the Federal Reserve's next move. This environment has specifically targeted Nvidia-backed CoreWeave (CRWV), where a spike in bond yields has raised alarms about its debt-heavy structure in the face of sticky inflation.
CoreWeave shares dropped as much as 7% on Thursday, extending a prior session in which they fell more than 16%. The decline reflects investor skepticism regarding the sustainability of debt-financed expansion in a high-interest-rate environment.