The Nasdaq Composite dove 5%, as previously high-flying large-cap tech stocks like Apple and Microsoft fell sharply. Nvidia's and AMD's losses also contributed to the decline.
There wasn't much in the way of major news that sparked the sell-off. Yet the valuations of many tech stocks have become stretched in recent weeks as the stock market rallied sharply off its March lows. It appears many traders and investors decided today was the day to begin taking some profits off the table.
Despite today's losses, Nvidia and AMD are still up 208% and 162%, respectively, in 2020. The two leading chipmakers are benefiting from the rising demand for chips in the gaming and cloud computing markets, as well as in a host of other industries.
These growth trends are likely to persist even if the stock market continues to fall in the days and weeks ahead. If you've had Nvidia or AMD on your watch list, further market declines could give you the chance to pick up some shares at a sizable discount to the prices at which they've recently traded.