The semiconductor sector just had its worst day in over six years. US-traded chipmakers shed roughly $1.3 trillion in market value on June 5, as a brutal sell-off tore through the industry and sent shockwaves into crypto, which lost an estimated $130 billion in parallel.
The Philadelphia Semiconductor Index cratered 10.3% in a single session, its steepest drop since March 2020. Over two days, the damage extended to around 12%.
Marvell Technology led the bleeding with a 17% decline, followed by Micron Technology at 13% and Advanced Micro Devices at roughly 11%. Nvidia fell nearly 6%, wiping out over $300 billion in market capitalization in one session. Broadcom dropped about 8% after its Q3 guidance on custom AI chips fell short of investor expectations, despite posting Q2 revenue of $22.19 billion, up 48% year-over-year.
The sell-off was fueled by AI enthusiasm and stronger-than-expected US jobs data, reigniting fears that the Federal Reserve would keep interest rates elevated for longer. The Nasdaq’s nine-week winning streak ended abruptly.
The $130 billion crypto market drawdown wasn't a coincidence. It was a symptom of a broad risk-off pivot that punished anything perceived as speculative. Rate-sensitive assets, crypto included, may face continued headwinds if the higher-for-longer narrative regains traction.