The S&P 500 experienced a weekly loss of 1.6%, largely influenced by a more than 10% drop in the iShares Semiconductor ETF (SOXX), as investor confidence in AI spending waned. Key factors included delays in Alphabet's AI model and Taiwan Semiconductor Manufacturing's increased spending forecasts, prompting sell-offs in tech shares.
Notably, Oracle's stock, which has an RSI of 17.4, fell 10% this week to a new 52-week low, despite Wall Street's recommendation to buy, with 35 out of 44 analysts rating it as a buy. Similarly, Super Micro Computer, with an RSI of 25.3, saw a 14% decline as it also faces challenges related to AI spending confidence.
In contrast, IBM's stock plummeted 26% after a disappointing earnings report, marking its worst session ever. Meanwhile, some stocks like Cintas and PayPal remained in overbought territory, with RSIs of 77.2 and 76.4, respectively, driven by strong earnings and acquisition interest, suggesting potential for a pullback in their prices