Tech stocks are selling off and there's no sign of any letup. Chip stocks lead the decline as investors reassess AI growth assumptions. A new AI model from a Chinese startup is one contributing factor, raising concerns about competitive pressures and valuation sustainability. The selloff reflects broader uncertainty about the pace of AI adoption and monetization.

Market participants are questioning whether current pricing adequately accounts for emerging rivals and potential saturation. Volatility remains elevated as earnings season approaches, with focus on guidance and capital expenditure plans. Analysts suggest the correction may create selective opportunities, but caution that macroeconomic headwinds and regulatory risks could prolong the downturn.