Tech Weekly: Hawkish Fed Sparks Mid-week Tech Selloff

This week's tech sector performance

Wall Street surged on Monday (June 15) on news of a potential US-Iran peace agreement and the reopening of the Strait of Hormuz, sending oil prices sharply lower and lifting investor sentiment. The S&P 500 (INDEXSP:.INX) and Nasdaq Composite (INDEXNASDAQ:.IXIC) both closed higher, with the tech-heavy index leading the rally.

Markets were mixed on Tuesday (June 16), with the Dow Jones Industrial Average (INDEXDJX:.DJI) hitting a second consecutive record close as technology stocks put pressure on the Nasdaq. Elsewhere, the US Federal Reserve convened for its first meeting under new Chair Kevin Warsh. The central bank held interest rates steady as expected, but its hawkishness triggered a selloff on Wednesday (June 17). Markets are now pricing in a hike by October.

After Wednesday’s selloff, tech stocks led a sharp rebound on Thursday (June 18), finishing the holiday-shortened week in positive territory after US President Donald Trump and Iranian President Masoud Pezeshkian signed a memorandum of understanding at the Palace of Versailles in France during the G7 Summit.

The deal effectively extends the ceasefire for 60 days and reopens the Strait of Hormuz. However, optimism about a quick end to the Middle East war collapsed after a planned Friday (June 19) meeting between Iranian negotiators and US Vice President JD Vance was postponed amid Israeli attacks on Lebanon.

In Canada, trading activity was muted on Friday, while US indexes were closed for Juneteenth.

3 tech stocks moving markets this week

This week's top tech stock movers, according to TradingView data, were:

1. Western Digital (NASDAQ:WDC)

Western Digital saw its share price rise 49.91 percent this week.

2. Arm Holdings (NASDAQ:ARM)

Arm Holdings saw a 39.77 percent improvement.

3. Sandisk (NASDAQ:SNDK)

Sandisk saw a gain of 30.65 percent.

Top tech news of the week

• Qualcomm (NASDAQ:QCOM) is reportedly in talks to buy artificial intelligence (AI) chip startup Tenstorrent for between US$8 billion and US$10 billion.

• SpaceX (NASDAQ:SPXC) announced a US$60 billion all-stock deal on Tuesday to purchase vibe coding startup Cursor. Following an extended rise in its share price early in the week, the company saw a modest pullback from Wednesday onward, ending the shortened week at US$185.

• Major AI player NVIDIA (NASDAQ:NVDA) raised US$25 billion in new debt on Monday, marking the company’s first corporate bond sale since 2021.

• Micron Technology (NASDAQ:MU) rallied on Monday after TD Cowen analyst Krish Sankar called memory’s role in the AI buildout “structural, not cyclical." He raised his price target for the firm from US$660 to US$1,500, maintaining a "buy" rating and delivering a bullish outlook for the company.

• Kazakhstan signed a package of agreements with Firebird and NVIDIA this week for computing projects involving NVIDIA GPUs. The deals could bring up to US$10 billion in multi-phase investment.

• Webull Canada, a subsidiary of Webull (NASDAQ:BULL), introduced 24/5 overnight trading using Blue Ocean ATS and Bruce Markets. It will give Canadian investors exposure to more than 12,000 US exchange-traded funds (ETFs) and stocks, provide real-time reactions to news and allow access to level-one market data. “With 24/5 trading, our users can respond to ... announcements and developments in real time, manage their exposure, and make decisions on their own timeline rather than waiting for the market to open,” said Michael Constantino, CEO of Webull Canada.

• Tech journalist and Ed Zitron obtained and shared leaked audited financial statements from OpenAI for 2024 and 2025. The documents reveal that OpenAI's revenue grew from US$3.7 billion to US$13.07 billion, while losses grew from US$5.09 billion to US$38.53 billion.

• General Motors (NYSE:GM) announced a collaboration with Lockheed Martin (NYSE:LMT) through which the companies will manufacture munitions domestically.

• Intel (NASDAQ:INTC) saw its share price surge on Thursday after Trump said the company will be collaborating with Apple (NASDAQ:AAPL) to design and manufacture semiconductors domestically.

• Canadian space technology firm MDA Space (NYSE:MDA) has agreed to buy US-based Blue Canyon Technologies from RTX's (NYSE:RTX) Raytheon business for US$620 million in cash.

Tech ETF performance

Tech ETFs track baskets of major tech stocks, meaning their performance helps investors gauge the overall performance of the niches they cover.

This week, the iShares Semiconductor ETF (NASDAQ:SOXX) advanced by 9.53 percent, while the Invesco PHLX Semiconductor ETF (NASDAQ:SOXQ) gained 9.33 percent.

The VanEck Semiconductor ETF (NASDAQ:SMH) gained 8.79 percent.

Tech news to watch next week

Tech investors will be focused on Micron, which is set to release its Q3 earnings on June 24 after the close. The market will be watching for signs of sustained AI-driven memory demand and HBM capacity through 2026.

BlackBerry (TSX:BB,NYSE:BB) will report its earnings on June 25 at 8:00 a.m. EDT. The day will also bring final US GDP numbers for the first quarter, and the latest personal consumption expenditures price index data.

Uncertainty around the temporary peace framework remains, and any renewed Strait of Hormuz disruption could push oil prices up, triggering risk-off sentiment and pressuring tech valuations.