Chip stocks have fallen as a "cash machine" for risk aversion, with Micron (MU.US) and SK Hynix leading the semiconductor sector's worst single month in three and a half years.

Notice that, as investors prepare to deal with the prolonged conflict in the Middle East, they are choosing to sell off the strongest performing tech stocks of recent months. Chip manufacturer Micron Technology, Inc. (MU.US) closed down 9.9% on Monday and continued to decline in after-hours trading. In the same industry, Samsung Electronics' stock price dropped by nearly 5%, while SK Hynix fell by as much as 7.7% in early Tuesday trading on the South Korean exchange. The uncertainty of whether the potential war between the U.S. and Israel against Iran can be resolved through peace talks is causing global markets to feel unsettled, with signs of a "cut-loss" surrender emerging in the market. After several years of AI-driven growth, tech stocks are currently experiencing their most brutal decline. Ortus Advisors analyst Andrew Jackson wrote, "As the end of the quarter approaches, investors are fleeing recent winners," "It would take some extraordinarily positive news today to turn the tables." The Bloomberg Semiconductor Index has already dropped by over 13% in March, potentially marking its worst single month performance in three and a half years. Nevertheless, the index is still on track to maintain a 10% gain by the end of the quarter. Due to concerns about potential disruptions in oil supply resulting from an Iran war, investors have been shifting towards more defensive stocks. After experiencing a hot streak of growth, AI trading appears particularly fragile considering additional worries about high spending levels and valuations. "Sentiment is shifting away from the AI space," said Gerald Gan, Chief Investment Officer of Reed Capital Partners in an interview on Monday. "I would consider taking more profits rather than adding more positions."