Finance

Artificial intelligence and semiconductor companies were the primary laggards during the market selloff, with a major gauge of chipmakers plunging over 4%. Higher projected interest rates heavily weighed on these growth-oriented companies due to the steep capital requirements needed to build out AI data centers. The broader tech rout also dragged the small-cap Russell 2000 index into official correction territory.

Financial shares fell as investors scrutinized the initial batch of quarterly reports from major institutions. Bank of America reported profits below analyst expectations, while Citigroup slid despite beating profit targets due to a sharp sequential drop in investment banking fees and higher credit-loss provisions. Additional regulatory headwind also pressured the banking sector following significant federal penalties levied against Bank of America over reporting failures.

The broader crypto market experienced downward momentum following the unexpectedly hot consumer price index report. Bitcoin retraced to around $82,418 after starting the session higher, while Ethereum fell back toward the $2,461 level. The negative reaction highlights cautious investor sentiment as prediction markets increasingly bet on a potential drop below the $80,000 threshold before the end of the month.