Nine big tech stocks evaporated one trillion dollars in a day! An overview of Wall Street interpretation of Friday's sell-off.

On Friday, the U.S. stock market experienced a bloody sell-off, with all three major indices recording declines. The Nasdaq 100 index, dominated by technology stocks, fell 4.2%, while the Philadelphia Semiconductor Index plummeted over 10%. At the same time, the price of Bitcoin fell below $60,000, and the spot price of gold erased all its gains for the year. The yield on the 10-year U.S. Treasury bond rose to 4.55%, while the yield on the 2-year bond reached its highest level since February 2025. In addition, the Wall Street fear index VIX surged 40%, hitting its highest level in two months. Technology stocks were the main victims of this sell-off. According to statistics, the market value of nine U.S. companies worth over a trillion dollars evaporated by $1.1 trillion on Friday, with an average stock price drop of 5.3%. Companies such as AI giants Nvidia, Micron Technology and AMD experienced particularly severe declines, as Broadcom's weak earnings report earlier this week caused turbulence on Wall Street. Besides Broadcom, strong non-farm payroll data has dampened market expectations of a Fed rate cut this year, shifting pricing logic from a loose cycle to a tightening path. This further impacted risk assets, digital currencies, and precious metal prices. Some views suggest that the upcoming SpaceX mega IPO is also one of the reasons for this sell-off, as investors are freeing up more funds for SpaceX. Regarding this sudden drop, Wall Street analysts currently have varying opinions and outlooks. Fed rate hikes still have a threshold, will next week's CPI be crucial? Chief U.S. economist at Natixis CIB Americas, Christopher Hodge: The threshold for rate hikes remains high, as U.S. labor market wage growth is weak, productivity is high, and inflation expectations remain stable. This indicates that the labor market is stable, but not overheated. Currently, the labor market is in a just right state, with a solid foundation but no need for inflation stimulus. Chief Investment Officer at Northlight Asset Management, Chris Zaccarelli: Rate hikes have not been finalized in the market, but the possibility of rate cuts this year is unlikely. With inflation so high, the Fed cannot cut rates. However, if inflation remains under control, especially in the face of turmoil in the Strait of Hormuz, they will not feel pressure to raise rates. Chief Market Strategist at Lazard, Ron Temple: Friday's strong jobs report has actually eliminated any hopes of a Fed rate cut, but he still believes that the likelihood of rate hikes is slim. However, in the May inflation report to be released next week, the overall CPI inflation rate may exceed 4%, which would make the rationale for loose policies no longer valid. Senior Investment Strategist at Canadian Imperial Bank of Commerce Wealth, David Donabedian: When the 10-year U.S. Treasury yield continues to exceed 4.5%, people should be on alert. Investors will closely watch the CPI data to be released next week. If the overall CPI increase exceeds 4% and the core CPI increase is close to 3%, coupled with job data, it will be difficult for the Fed to consider rate cuts. Chief U.S. economist at Citigroup, Andrew Hollenhorst: The strong May jobs report will undoubtedly prompt Fed officials to pay more attention to upward inflation risks at the June policy meeting, rather than weak labor market conditions. However, it is expected that the U.S. labor market will gradually cool down in the next three months, sparking expectations of rate cuts. Are tech stocks overbought, is this a healthy correction? Analyst at Mizuho Securities, Daniel O'Regan: The S&P 500 index, Nasdaq 100 index, and Philadelphia Semiconductor Index are all severely overbought. Positions are crowded and diversified, which is what normalization looks like in the market. From a more macro perspective, today's sell-off only brings people back to levels of a few weeks ago. CEO of Cestrian Capital Research, Alex King: On Friday, the S&P 500 index and Nasdaq index hit their lowest levels in two weeks. Investors should view this pullback from a risk management perspective rather than succumbing to panic. Disciplined investors should focus on finding attractive investment opportunities after the selling pressure eases. Chief Investment Officer at Navellier & Associates, Louis Navellier: Investors seem to be taking profits, especially in the semiconductor industry, and investors who buy on the dips have not yet entered. But the overall trend remains positive, and there is still hope that the Iran issue will be resolved in the short term. Chief Stock Strategy Officer at Wells Fargo, Ohsung Kwon: Friday's market reaction was more due to position adjustments than fundamental factors. The semiconductor sector is severely overbought, which is why the market saw a sell-off, but he believes this is not the end of the semiconductor bull market. Chief Market Strategist at American Express, Anthony Saglimbene: The job market remains strong, and the long-term bullish factors for artificial intelligence still exist, but the market is undergoing some rational adjustments, which are healthy in the long run. Chief Investment Officer at Candriam, Nicolas Forest: Funds are heavily concentrated in AI and chip themes, posing obvious problems. If people are concerned or disappointed with the performance of the AI field, it will be difficult to maintain optimism for risk assets. Next week's large IPO is coming, should investors withdraw liquidity first? President of D.A. Investment Advisory, Peter Tuz: Friday's situation continued the drop caused by Broadcom on Thursday. Broadcom's quarterly performance was very strong, but its guidance was below expectations. People are speculating whether this situation will spread to other chip companies and related enterprises. In addition, a series of IPOs starting next week may bring additional risks to the market, which is worrisome. Chief Market Strategist at BMO Private Wealth, Carol Schleif: Part of the sell-off was due to interest rates, but part of it was also because investors are temporarily holding back some funds for the upcoming IPO. Technology stocks have been strong, with gains of nearly 10% in the past three months. A slight adjustment now is reasonable. Founder of Mott Capital Management, Michael Kramer: Alphabet's recent equity issuance, along with news that Meta may follow suit with a large-scale equity financing, has raised some concerns. In the coming quarters, these companies will face a dilemma: either borrow or issue more shares to meet spending requirements, or cut capital expenditures, which is not optimistic for stock prices.