In recent years, investors showed their optimism about the future by flocking to high-growth stocks -- and that pushed the prices of some of these players into the stratosphere. The idea was these companies would benefit from a potentially lower interest-rate environment ahead, and, in many cases, the development of artificial intelligence (AI).
After a sharp rise the past few years, the stock market has had a rocky start to 2025. Concerns that President Donald Trump's tariff policies could send the economy into a recession have extended the declines for the major market indexes over the last few weeks.
The Nasdaq entered correction territory earlier this week, and a number of leading artificial intelligence (AI) semiconductor stocks have been swept up in the market downturn. However, spending on AI infrastructure has not suddenly dried up, and in fact it is still on the rise.
The Nasdaq Composite (^IXIC -0.18%) is officially in a correction, with the tech-heavy Nasdaq-100 index down about 12% from its recent high. And while there are some stocks that still look rather pricey, even after the downturn, there are some excellent bargains to be found for patient long-term investors.
The markets have been volatile over the past few weeks as investors process a slew of economic and policy changes. The tech-heavy Nasdaq Composite is officially in correction territory, down more than 13% from its recent highs as of the close of trading Monday.
The Nasdaq (^IXIC -0.18%) has officially entered correction territory, falling by close to 13% since mid-February, as of this writing. Monday marked the index's worst single-day drop since 2022, as it plunged by 4% -- fueling concerns about a looming bear market or recession.
After running hard for more than two years, the current bull market is finally taking a well-deserved breather. The Nasdaq Composite has slipped into correction territory, defined as a decline of 10% or more from a recent peak.
The Nasdaq has hit some turbulence this year. It's currently down more than 10% from its recent peak, which puts it in correction territory.
The Nasdaq has hit some turbulence this year. It's currently down more than 10% from its recent peak, which puts it in correction territory.
The Nasdaq has entered correction territory, and just as the so-called "Magnificent Seven" stocks led the market higher during the bull run, these stocks have helped lead the market lower during this recent correction. The "Magnificent Seven" consist of seven leading technology companies: Alphabet (GOOGL -2.15%) (GOOG -2.17%), Amazon (AMZN 0.15%), Apple, Meta Platforms, Microsoft, Nvidia (NVDA 1.46%), and Tesla, all of which trade on the Nasdaq stock exchange.
The Nasdaq Composite has tumbled in recent weeks. The index is down more than 10% from its peak, which puts it in correction territory (a decline of 10% or more from the high).
Technology stocks have hit a rough patch of late as investors have been looking to reduce their exposure to riskier assets in the wake of the tariff-induced trade war, leading to an increase in demand for safer investments.