Tech Stocks Stabilize After AI-Driven Sell-Off

Investors are searching for stability at the start of the week following a sharp Friday decline. While futures show signs of steadying, significant valuation concerns within the artificial intelligence sector continue to weigh heavily on market sentiment. The key question now is whether a deeper correction for technology giants is imminent or if the recent pullback presents a fresh opportunity.

Nasdaq 100 futures were trading nearly flat around 25,250 points as Monday's session began. This tentative calm follows a volatile Friday that saw the index drop 1.91%, erasing its gains for the entire week. The selling pressure extended into Asian markets overnight, with notable losses recorded in South Korea's KOSPI and Japan's Nikkei.

The broader market backdrop is providing little relief. The latest interest rate decision from the U.S. Federal Reserve on December 10th is acting as a headwind. Although the Fed lowered its benchmark rate to a range of 3.50% to 3.75%, it signaled fewer rate cuts for 2026 than the market had anticipated. This is forcing investors to reassess yield expectations. Furthermore, weak industrial data from China, released this Monday, is dampening global risk appetite.

From a technical perspective, the index appears vulnerable. It closed below its 20-day moving average on Friday. Critical support now rests at Friday's low of 25,100 points. A decisive break below this level could pave the way for a test of the psychologically significant 25,000 threshold.

Should investors sell immediately? Or is it worth buying NASDAQ 100?

Semiconductor Sector Leads the Decline

The recent turbulence was triggered primarily by disappointed expectations in the semiconductor space. Broadcom found itself at the epicenter, plunging 11%. While the company's reported figures exceeded official estimates, they failed to meet the exceptionally high expectations on the buy-side regarding AI infrastructure spending.

This disappointment dragged down the entire sector:
* Micron Technology fell 7% amid worries over pricing trends for memory chips.
* AMD declined 4.8%, breaking below key technical support levels.
* AppLovin continued its correction, dropping 6.5%.

Only a handful of stocks managed to resist the downward trend. Lululemon jumped 10% following solid earnings, while Adobe (+1.7%) benefited from a slight rotation into more moderately valued software names.

Traders are now focused on the U.S. market open. A successful defense of the 25,100-point level could allow bullish investors to mount a counterattack. Crucial intraday catalysts will include data from the Empire State Manufacturing Index and further commentary from Federal Reserve officials.