What Happened?
A number of stocks fell in the morning session after concerns regarding lofty artificial intelligence valuations triggered a pullback in the technology sector.
Nvidia slid 3% ahead of its earnings report, dragging down fellow "Magnificent Seven" peers despite a major partnership announcement with Anthropic, as investors increasingly question the durability of the AI rally. Market sentiment was further dampened by Bitcoin dropping below $90,000, signaling reduced risk appetite, and growing anxiety that the Federal Reserve may pause rate cuts in December, with the implied probability of a cut falling to roughly 50%.
Adding to the weakness, Home Depot shares declined following an earnings miss and a cut to its full-year outlook. This combination of continued de-risking and valuation skepticism put the S&P 500 on pace for its fourth consecutive daily decline.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.
Among others, the following stocks were impacted:
- Semiconductor Manufacturing company Marvell Technology (NASDAQ: MRVL) fell 4.6%. Is now the time to buy Marvell Technology? Access our full analysis report here, it’s free for active Edge members.
- Memory Semiconductors company Western Digital (NASDAQ: WDC) fell 6.3%. Is now the time to buy Western Digital? Access our full analysis report here, it’s free for active Edge members.
- Memory Semiconductors company Seagate Technology (NASDAQ: STX) fell 1.8%. Is now the time to buy Seagate Technology? Access our full analysis report here, it’s free for active Edge members.
- Processors and Graphics Chips company Penguin Solutions (NASDAQ: PENG) fell 3.2%. Is now the time to buy Penguin Solutions? Access our full analysis report here, it’s free for active Edge members.
- Semiconductor Manufacturing company Applied Materials (NASDAQ: AMAT) fell 2.8%. Is now the time to buy Applied Materials? Access our full analysis report here, it’s free for active Edge members.
Zooming In On Western Digital (WDC)
Western Digital’s shares are very volatile and have had 28 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was about 23 hours ago when the stock gained 2.1% on the news that the company announced a series of next-generation storage solutions aimed at the rapidly growing artificial intelligence (AI) and high-performance computing (HPC) markets. At an industry event, Western Digital showcased its Ultrastar Data60 and Data102 products, which were designed to provide higher storage density and consume less power.
Western Digital is up 147% since the beginning of the year, but at $152.84 per share, it is still trading 12.3% below its 52-week high of $174.22 from November 2025. Investors who bought $1,000 worth of Western Digital’s shares 5 years ago would now be looking at an investment worth $3,597.
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