US stock close gives the answer: the selloff isn’t over yet, but it’s also not turning into an all-out freefall

After the Asia markets closed yesterday, two real questions remained.

First, can US stocks absorb the selling pressure in semiconductors?

Second, will this pullback widen—from chip stocks—to make the entire market stall out together?

The answer is clearer now.

US stocks haven’t stopped falling. The S&P 500 is down 1.01%, the Nasdaq is down 1.40%, the Dow is down 0.77%, and all three major indexes also closed in the red for the week.

But it also wasn’t a straight drop all the way into the close.

The Nasdaq was down nearly 2% at one point at the open, but the decline narrowed to 1.40% by the close. Micron fell as much as 5.8% intraday, but closed down only 0.5%. This suggests bargain-hunting capital has moved in, but it isn’t enough to reverse the trend.

What still needs caution is semiconductors.

The Philadelphia Semiconductor Index logged its largest weekly drop in more than a year this week. Since July, it has fallen more than 18%, which is 20.2% below the June 22 closing high. By the market’s most common definitions, it has entered a bear-market range.

This also explains why Taiwan’s market fell 6.47% yesterday and Japan’s Nikkei dropped 4.03%—it isn’t just Asia scaring itself. After the US stock close, the repricing of AI and chip stocks is still underway.

But don’t rush to translate it directly into “AI demand has collapsed.”

So far, 49 S&P 500 companies have released their Q2 earnings results, and 90% of profits beat expectations. Market estimates for the overall corporate earnings year-over-year growth rate have also been revised up from 19.2% in early April to 26.0%.

In other words, what’s falling hardest right now is price and expectations—not corporate earnings that have already been confirmed.

And this time, not all stocks are falling at the same pace. Russell 2000, which represents small- and mid-cap stocks, is only down 0.4%, while energy stocks are still the only sector in the S&P 500’s eleven major categories that’s up.

That looks more like the market is breaking apart and repricing over-concentrated AI trades, rather than the entire US economy suddenly hitting the brakes at once.

The real trouble is that oil prices are pushing up another variable again.

Brent crude rose 4.6% on Friday, closing at $88.10 per barrel. About a week earlier it was around $76. As tech stocks digest rich valuations, higher oil prices will once again add uncertainty around inflation, interest rates, and corporate costs—making it harder for the market to quickly return to its original risk appetite.

The economic data released on Friday also didn’t provide a single clear direction.

US June industrial production grew only slightly, by 0.1%, and manufacturing output was flat. While housing starts jumped 19%, the increase was mainly from multi-family homes; single-family housing starts actually fell 0.2%, and building permits also declined 3%.

So this weekend, instead of guessing whether Monday will bounce, it’s more worth watching three things.

First, can the Philadelphia Semiconductor Index stop breaking down?

Second, can oil prices cool off from around $88?

Third, in the upcoming earnings, have companies started to cut back on AI orders, capital expenditures, or gross margins?

If stocks fall first but company guidance doesn’t weaken, it still leans toward valuation and position adjustments.

If prices, orders, and earnings expectations all move lower together, that’s when fundamentals truly shift direction.

Five other things to watch this morning

1｜All three US equity index weekly charts close red

The S&P 500 closed at 7,457.69, down 1.01%; the Dow is down 0.77%, and the Nasdaq is down 1.40%. For the week, the three major indexes are down 1.6%, 0.9%, and 2.9%, respectively.

2｜Philadelphia Semis enter a bear-market range

The Philadelphia Semiconductor Index fell another 1.63% on Friday. Since July, it has dropped more than 18%, and the close is now 20.2% below the June 22 high. This pressure is still highly concentrated in AI and chip trading.

3｜Brent crude closes above $88

Brent crude rose 4.6%, closing at $88.10 per barrel, versus about $76 a week earlier. The Iran-Iraq conflict and shipping concerns in the Strait of Hormuz remain the main sources of oil-price risk.

4｜US housing starts surge, but the structure isn’t as strong as the headline

June housing starts rose 19% month over month to an annualized 1.43M units. The gain was mainly driven by multi-family homes; single-family housing starts fell 0.2% month over month, and building permits fell 3% month over month.

5｜US industrial production grows only slightly

June industrial production rose 0.1% month over month. Manufacturing output was flat, and capacity utilization remained at 76.1%. The data didn’t show the economy abruptly stalling, nor was it strong enough to eliminate concerns raised by high oil prices.

Data cut-off: 2026-07-18 08:40 (Singapore time) US stock close gives the answer: the selloff isn’t over yet, but it’s also not turning into an all-out freefall

After the Asia markets closed yesterday, two real questions remained.

First, can US stocks absorb the selling pressure in semiconductors?

Second, will this pullback widen—from chip stocks—to make the entire market stall out together?

The answer is clearer now.

US stocks haven’t stopped falling. The S&P 500 is down 1.01%, the Nasdaq is down 1.40%, the Dow is down 0.77%, and all three major indexes also closed in the red for the week.

But it also wasn’t a straight drop all the way into the close.

The Nasdaq was down nearly 2% at one point at the open, but the decline narrowed to 1.40% by the close. Micron fell as much as 5.8% intraday, but closed down only 0.5%. This suggests bargain-hunting capital has moved in, but it isn’t enough to reverse the trend.

What still needs caution is semiconductors.

The Philadelphia Semiconductor Index logged its largest weekly drop in more than a year this week. Since July, it has fallen more than 18%, which is 20.2% below the June 22 closing high. By the market’s most common definitions, it has entered a bear-market range.

This also explains why Taiwan’s market fell 6.47% yesterday and Japan’s Nikkei dropped 4.03%—it isn’t just Asia scaring itself. After the US stock close, the repricing of AI and chip stocks is still underway.

But don’t rush to translate it directly into “AI demand has collapsed.”

So far, 49 S&P 500 companies have released their Q2 earnings results, and 90% of profits beat expectations. Market estimates for the overall corporate earnings year-over-year growth rate have also been revised up from 19.2% in early April to 26.0%.

In other words, what’s falling hardest right now is price and expectations—not corporate earnings that have already been confirmed.

And this time, not all stocks are falling at the same pace. Russell 2000, which represents small- and mid-cap stocks, is only down 0.4%, while energy stocks are still the only sector in the S&P 500’s eleven major categories that’s up.

That looks more like the market is breaking apart and repricing over-concentrated AI trades, rather than the entire US economy suddenly hitting the brakes at once.

The real trouble is that oil prices are pushing up another variable again.

Brent crude rose 4.6% on Friday, closing at $88.10 per barrel. About a week earlier it was around $76. As tech stocks digest rich valuations, higher oil prices will once again add uncertainty around inflation, interest rates, and corporate costs—making it harder for the market to quickly return to its original risk appetite.

The economic data released on Friday also didn’t provide a single clear direction.

US June industrial production grew only slightly, by 0.1%, and manufacturing output was flat. While housing starts jumped 19%, the increase was mainly from multi-family homes; single-family housing starts actually fell 0.2%, and building permits also declined 3%.

So this weekend, instead of guessing whether Monday will bounce, it’s more worth watching three things.

First, can the Philadelphia Semiconductor Index stop breaking down?

Second, can oil prices cool off from around $88?

Third, in the upcoming earnings, have companies started to cut back on AI orders, capital expenditures, or gross margins?

If stocks fall first but company guidance doesn’t weaken, it still leans toward valuation and position adjustments.

If prices, orders, and earnings expectations all move lower together, that’s when fundamentals truly shift direction.

Five other things to watch this morning

1｜All three US equity index weekly charts close red

The S&P 500 closed at 7,457.69, down 1.01%; the Dow is down 0.77%, and the Nasdaq is down 1.40%. For the week, the three major indexes are down 1.6%, 0.9%, and 2.9%, respectively.

2｜Philadelphia Semis enter a bear-market range

The Philadelphia Semiconductor Index fell another 1.63% on Friday. Since July, it has dropped more than 18%, and the close is now 20.2% below the June 22 high. This pressure is still highly concentrated in AI and chip trading.

3｜Brent crude closes above $88

Brent crude rose 4.6%, closing at $88.10 per barrel, versus about $76 a week earlier. The Iran-Iraq conflict and shipping concerns in the Strait of Hormuz remain the main sources of oil-price risk.

4｜US housing starts surge, but the structure isn’t as strong as the headline

June housing starts rose 19% month over month to an annualized 1.43M units. The gain was mainly driven by multi-family homes; single-family housing starts fell 0.2% month over month, and building permits fell 3% month over month.

5｜US industrial production grows only slightly

June industrial production rose 0.1% month over month. Manufacturing output was flat, and capacity utilization remained at 76.1%. The data didn’t show the economy abruptly stalling, nor was it strong enough to eliminate concerns raised by high oil prices.

Data cut-off: 2026-07-18 08:40 (Singapore time)