What Happened?

A number of stocks fell in the morning session after investors reassessed stretched valuations following a period of strong gains. The tech-heavy Nasdaq fell as much as 1.6%, with the S&P 500 also declining. 

The pullback was exemplified by AI firm Palantir Technologies, which dropped over 7% despite reporting better-than-expected sales. This negative reaction to positive news suggests investors are concerned about extreme valuations and are engaging in "long liquidation"—selling positions to lock in profits after a significant rally. Adding serious weight to this caution, leadership at both Goldman Sachs and Morgan Stanley highlighted the possibility of a correction in the equity markets over the next couple of years. Despite the euphoria driven by AI optimism and the promise of future rate cuts, these banks viewed this cooling-off period not as a disaster, but as a necessary and healthy feature of a long-term bull market.

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:

• Processors and Graphics Chips company Qorvo (NASDAQ: QRVO) fell 3.5%. Is now the time to buy Qorvo? Access our full analysis report here, it’s free for active Edge members.
• Processors and Graphics Chips company Intel (NASDAQ: INTC) fell 5.2%. Is now the time to buy Intel? Access our full analysis report here, it’s free for active Edge members.
• Memory Semiconductors company Micron (NASDAQ: MU) fell 4.2%. Is now the time to buy Micron? Access our full analysis report here, it’s free for active Edge members.
• Memory Semiconductors company Seagate Technology (NASDAQ: STX) fell 4%. Is now the time to buy Seagate Technology? Access our full analysis report here, it’s free for active Edge members.
• Memory Semiconductors company Western Digital (NASDAQ: WDC) fell 3.1%. Is now the time to buy Western Digital? Access our full analysis report here, it’s free for active Edge members.

Zooming In On Intel (INTC)

Intel’s shares are extremely volatile and have had 36 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 21 days ago when the stock dropped 5.8% on the news that a Bank of America analyst downgraded the stock to "underperform" from "neutral," citing concerns that the shares had climbed "too far, too fast." The analyst noted that the stock's recent rally, which added about $80 billion to its market value, was not justified given its ongoing challenges. These concerns included an uncompetitive server CPU lineup and no clear strategy for the growing artificial intelligence market.

Intel is up 85.9% since the beginning of the year, but at $37.59 per share, it is still trading 9.5% below its 52-week high of $41.53 from October 2025. Investors who bought $1,000 worth of Intel’s shares 5 years ago would now be looking at an investment worth $822.43.

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