The State of the Tech Trade: Your Next Move 7/17/26

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**SPEAKER_2** (0:31)
Regarding that seat on the committee, we're promoting.

**SPEAKER_3** (0:33)
To boost quarterly earnings.

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**Scott Wapner** (1:00)
I'm Scott Wapner and you're listening to Cnbc's Halftime Report, the podcast, the most profitable hour of the trading day. We record this live weekdays at 12 Eastern. Listen in.

**Dominic Chu** (1:15)
All right. Thanks very much, Carl.

**SPEAKER_2** (1:16)
Thanks very much, Sarah.

**Dominic Chu** (1:17)
Welcome to the Halftime Report. I am Dominic Chewin for Scott Wapner today. Front and center this hour. Big news out of China, sending shivers through that tech trade. The Investment Committee at the ready to break it all down, including the fallout. Joining me for the hour are Steve Weiss, Jenny Harrington and Kevin Simpson right here at the New York Stock Exchange. Let's get a check on the markets overall right now. We are seeing a down day, fractionally so for the downed industrial is off about, now just about one-tenth of 1%. It's about 52.526. The S&P though, down one-half of 1%, sitting right below the 7500 mark. And the NASDAQ composite, the tech heavier index, down about 1% right now. The semiconductor trade, the real pain point again, as China rolls out a powerful new AI model. Now to the scorecard for the semis, as you can kind of see here, it's moving a little to the downside. Nvidia shares, AMD, the lot, are going to the downside right now. That's driving the momentum ETF on pace for its worst week since April of 2025
The DRAM ETF on pace for its worst week since inception, and the SOX ETF is now in a quote unquote bear market off 20% from its recent highs. All of these things are happening at once, but it has become the epicenter of that momentum AI tech overall trade. So let's go to the committee for what's going on right now, and maybe I'll start Steve with you.
The sentiment, we've seen this before, just not to the degree recently that we've seen over the past week and a half with the chip trade. Is this finally the rollover, or are we just gonna buy it after it goes down a little bit more again, because the valuations have become more compelling?

**Steve Weiss** (2:58)
Yeah, so there are multiple points to that question. First of all, it's not just been a week and a half, it's been a longer time. We've seen huge volatility in the semi-trade, but they keep making lower highs, which if you look at it from a technical standpoint is troubling. In terms of what drove it, the market always talks about that the market stay irrational for longer than you could say solvent. That works both on the upside and then when you're coming down on the downside. Upside in terms of being short, downside in terms of being long.
So where I think we are is that the market is beginning to pull forward.
I've said this repeatedly on the show, the end of the cycle. If everybody's saying the cycle is going to be over, and I'm talking about they'll never spend again, I'm talking about peak spending only. The market has not been anticipating peak spending. It's been trading like spending is going to continue to increase. We saw a hint of that on Meta News, where they say we're going to increase by 40 billion.
But that's what it's anticipating. Then you take some of the, in other words, they were anticipating the spending, we'll keep going and make new peak, new peak. The others, and what's been the controlling narrative over the last month or so, is that, okay, everybody's saying we got a year or two, and I'm not going to be the last one out. So the ones that were in the earliest are the sellers. And then you've got the nervous hands, the week holders who came in at the end of momentum trade, and they're the fastest ones to sell because they're booking losses. Now, here's where I'd say where we are. I don't think it's over completely. I'm not sure the reset is over either. China, which you're bringing up, is a new point. It's not a new point. I referenced it this week. I referenced it last week. You have to be sleeping not to have known that China has much cheaper models, whereas tokens have gotten very expensive here, and much more effective AI.