Key Highlights

  • The Nasdaq Composite fell 248.34 points to 26,820.38, and the Nasdaq-100 dropped 331.32 points to 30,276.81.
  • Reports that OpenAI paused Training of some frontier models sent the Philadelphia Semiconductor index sharply lower.
  • Meta Platforms fell sharply after launching an enterprise AI platform and hiring MongoDB CEO CJ Desai to lead it.
  • The 10-year Treasury Yield reached its highest level since 2007, and the 30-year its highest since 2004.

Nvidia (NASDAQ:NVDA) rose on Monday, September 28, after unveiling the largest buyback increase ever, but the rest of big tech sank under rising yields, a chip-sector rout and a sharp fall in Meta (NASDAQ:META), dragging the Nasdaq lower.

One winner, many losers

Nvidia gave investors a big headline on Monday. Its board authorized an additional $150 billion in share repurchases, bringing its total authorization to about $235 billion, described as the largest share repurchase increase in history. The stock rose.14.

It was not enough. The Nasdaq Composite fell 248.34 points to 26,820.38, and the Nasdaq-100 dropped 331.32 points to 30,276.81.

The chip rout

The biggest problem was the rest of the chip sector. Reports that OpenAI paused training of some frontier models sent the Philadelphia Semiconductor Index sharply lower. Qualcomm (NASDAQ:QCOM) plunged to $187.48, the worst performer in the S&P 500. Intel (NASDAQ:INTC) fell to $116.03, and Arm Holdings (NASDAQ:ARM) tumbled. AMD (NASDAQ:AMD), Micron (NASDAQ:MU), Marvell (NASDAQ:MRVL) and Broadcom (NASDAQ:AVGO) all declined.

Nvidia, the AI chip leader, held up in part because its buyback gave investors a reason to stay. It also launched an Open Agent Safety Platform to put guardrails on AI agents, a timely move given the reports about OpenAI.

Meta and the megacaps

Meta Platforms fell sharply after launching an enterprise AI platform and hiring MongoDB (NASDAQ:MDB) CEO CJ Desai to lead it. The stock was coming off a strong weekly rally after its Connect event. MongoDB itself plunged. Communication services was the worst-performing S&P 500 sector.

Other megacaps sagged too. Microsoft (NASDAQ:MSFT) fell to $509.38, Tesla (NASDAQ:TSLA) dropped to $359.80, and Amazon (NASDAQ:AMZN), Apple (NASDAQ:AAPL) and Alphabet (NASDAQ:GOOGL) all slipped.

Yields: the wider headwind

Behind the tech weakness was the bond market. The 10-year Treasury yield reached its highest level since 2007, and the 30-year its highest since 2004. Higher yields weigh most on growth stocks, whose value rests heavily on profits expected far in the future. Goldman Sachs (NYSE:GS) strategist Ben Snider said that "The rise in interest rates" explains the compression in price-to-earnings multiples.

Oil added to the pressure after President Trump rejected Iran's Hormuz plan. E*Trade's Chris Larkin said: "The broader market hasn't been able to gain much traction because of rising yields and oil prices."

Breadth was weak. On the Nasdaq, 2,218 stocks declined and only 1,185 rose, and just 50 hit 52-week highs versus 461 lows. BTIG's Jonathan Krinsky warned: "The divergence in the positive performance of the S&P 500 and extremely weak breadth is unsustainable. Something's gotta give."

Why one stock can't carry the market

Nvidia is one of the heaviest weights in the Nasdaq-100, so its gains help. But when many other heavyweights fall at once, a single winner cannot offset them. Monday showed the limits of index concentration: even a record-breaking corporate announcement from the AI chip leader could not reverse a broad selloff.

AI hardware faces its Micron test

Micron's Earnings on Wednesday after the close will test whether AI hardware Demand remains strong after the OpenAI reports. Wednesday's PCE Inflation data and Friday's September jobs report will steer yields. OpenAI's DevDay on Tuesday may offer clues about its training plans, and any updates from Nvidia on how it will deploy the buyback will be watched closely.