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▲ US stocks, semiconductors, electric vehicles, bear market/AI generated image
Immediately after investor Michael Burry, known as a prominent pessimist on Wall Street, disclosed a short position targeting the overheating of artificial intelligence (AI), semiconductor and electric vehicle-related stocks simultaneously faltered, bringing cracks in the tech stock rally to the forefront of the market.
According to crypto media outlet BeInCrypto on July 3 (local time), Burry disclosed new short positions on June 30, targeting Tesla (TSLA), NVIDIA (NVDA), Caterpillar (CAT), Applied Materials (AMAT), and the semiconductor sector. Burry presented this position not as a stock-specific selling strategy, but as a bet on an overheated AI cycle.
In a post on Substack, Burry pointed out that the semiconductor index was "a pure form of overvaluation" and extended the expiration of SOXX put options until March 2027. At the time of Burry's disclosure, the Philadelphia Semiconductor Index was trading more than 65% above its 200-day moving average. Burry compared this trend to the dot-com bubble era.
Market reaction quickly cooled. After reports emerged that Meta (META) was building a Meta Compute business to lease its excess AI data center capacity to external customers, investors interpreted this as a sign that AI compute supply was catching up with demand. On July 2, the Philadelphia Semiconductor Index plummeted by over 6%, and the selling pressure spread to Samsung and SK Hynix in Asian markets. A circuit breaker was temporarily triggered in South Korea's KOSPI.
Memory and storage-related stocks also saw significant declines. SanDisk fell by approximately 20% over the past five trading days, while Seagate and Micron also showed weakness amid oversupply concerns. Micron's Q3 fiscal year revenue increased by 346% year-over-year, but its stock price gave back some of its 2026 gains.
Tesla also dropped 7.5% on the same day, marking its largest single-day decline in about a year. Although Q2 vehicle deliveries of 480,126 units exceeded Wall Street's expectations, the market engaged in profit-taking after the strong performance was announced. BeInCrypto reported that while Burry's short position cannot be definitively stated as the direct cause of the stock price drop, the fact that most of the asset classes he targeted are under pressure suggests that Tesla's upcoming earnings release on July 22 and its AI capital expenditure outlook will be key variables in determining whether tech stocks will undergo a correction.
Immediately after investor Michael Burry, known as a prominent pessimist on Wall Street, disclosed a short position targeting the overheating of artificial intelligence (AI), semiconductor and electric vehicle-related stocks simultaneously faltered, bringing cracks in the tech stock rally to the forefront of the market.
According to crypto media outlet BeInCrypto on July 3 (local time), Burry disclosed new short positions on June 30, targeting Tesla (TSLA), NVIDIA (NVDA), Caterpillar (CAT), AMAT, and the semiconductor sector. Burry presented this position not as a stock-specific selling strategy, but as a bet on an overheated AI cycle.
In a post on Substack, Burry pointed out that the semiconductor index was "a pure form of overvaluation" and extended the expiration of SOXX put options until March 2027. At the time of Burry's disclosure, the Philadelphia Semiconductor Index was trading more than 65% above its 200-day moving average. Burry compared this trend to the dot-com bubble era.
Market reaction quickly cooled. After reports emerged that Meta (META) was building a Meta Compute business to lease its excess AI data center capacity to external customers, investors interpreted this as a sign that AI compute supply was catching up with demand. On July 2, the Philadelphia Semiconductor Index plummeted by over 6%, and the selling pressure spread to Samsung and SK Hynix in Asian markets. A circuit breaker was temporarily triggered in South Korea's KOSPI.
Memory and storage-related stocks also saw significant declines. SanDisk fell by approximately 20% over the past five trading days, while Seagate and Micron also showed weakness amid oversupply concerns. Micron's Q3 fiscal year revenue increased by 346% year-over-year, but its stock price gave back some of its 2026 gains.
Tesla also dropped 7.5% on the same day, marking its largest single-day decline in about a year. Although Q2 vehicle deliveries of 480,126 units exceeded Wall Street's expectations, the market engaged in profit-taking after the strong performance was announced. BeInCrypto reported that while Burry's short position cannot be definitively stated as the direct cause of the stock price drop, the fact that most of the asset classes he targeted are under pressure suggests that Tesla's upcoming earnings release on July 22 and its AI capital expenditure outlook will be key variables in determining whether tech stocks will undergo a correction.
[Article Summary]
-Burry disclosed short positions on June 30, targeting Tesla, NVIDIA, Caterpillar, AMAT, and the semiconductor sector.
-The Philadelphia Semiconductor Index plunged over 6% on July 2, and SanDisk fell by approximately 20% over the past five trading days.
-Although Tesla's Q2 vehicle deliveries of 480,126 units exceeded expectations, its stock price fell by 7.5% on the same day.
*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*
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