Tech Sell-off and Geopolitical Friction Pull Markets Lower

The semiconductor index bore the brunt of the session, sliding 2.6% as heavyweights Nvidia and Broadcom dragged broader market indices downward. Market participants pivoted toward profit-taking, wary that the tech sector’s extended rally has left valuations disconnected from the cooling economic backdrop. Persistent inflation remains a central concern, with U.S. consumer prices climbing 4.2% through May, largely driven by energy price spikes linked to the Middle East conflict.

Beyond the immediate geopolitical volatility, the Federal Reserve’s outlook continues to weigh on investor sentiment. Markets are currently bracing for a potential 25-basis-point interest rate hike later this year, a move that would further tighten liquidity. As energy costs remain elevated and military rhetoric between Washington and Tehran intensifies, the combination of macroeconomic pressure and sector-specific weakness suggests a volatile period ahead for major equity benchmarks.