The New York stock market's major indices fell simultaneously, facing dual difficulties with NVIDIA and Powell.
On the 16th (local time), the Dow Jones Industrial Average closed down 699.57 points (1.73%) at 39,669.39 on the New York Stock Exchange. The Standard and Poor's (S&P) 500 index fell 120.93 points (2.24%) to close at 5,275.70, while the tech-heavy NASDAQ index plummeted 516.01 points (3.07%) to end at 16,307.16.
The Trump administration increased the level of semiconductor export restrictions to China, leading to continued selling pressure on tech stocks, including semiconductors and artificial intelligence (AI).
The U.S. Department of Commerce announced the day before that it would apply new export licensing requirements when exporting NVIDIA's H20 chip to China. The department added that other chips corresponding to AMD's AI chip MI308 were also included in the regulatory targets.
As a result, stocks such as AMD (-7.35%), ASML (-7.06%), NVIDIA (-6.87%), and TSMC (-4.68%) fell sharply. Apple (-3.89%) and Microsoft (-3.66%) also saw continued selling.
Remarks from Jerome Powell, Chair of the U.S. Federal Reserve (Fed), regarding the 'Trump tariff' also acted as a negative factor for the market.
On that day, Powell noted, "The level of tariff increases by the Trump administration is much higher than expected," and added, "This will lead to inflation and a slowdown in growth." He maintained a cautious stance on the possibility of interest rate cuts.
Following these remarks, the NASDAQ, which had been down over 2%, saw its decline extend to 4.5% at one point during the trading session.
By sector, all sectors except energy declined. Technology fell 3.94%, while consumer discretionary and telecommunications services dropped over 2%.
The 'Magnificent Seven,' referring to seven major tech companies, all fell. All but NVIDIA showed declines generally around 3%, while Tesla dropped 5%.
At the same time, gold, a representative safe-haven asset, briefly surpassed $3,350 per ounce, setting a record high.
Zachary Hill, head of portfolio management at Horizon Investments, said, "The weight of tech stocks in the S&P 500 index is having an unbalanced effect on stock prices."