Midday Market: Tech Sells Off; VIX Pops as Energy Holds Up

Introduction#

U.S. equities slipped from the opening bell into midday on Friday, August 29, 2025, with the tape characterized by a decisive selloff in large-cap technology and semiconductors, cautious bid in defensives, and a volatility uptick that underscored a de-risking tone ahead of the long weekend. According to Monexa AI real-time tape, the S&P 500 pulled back after setting a fresh year high yesterday, the Nasdaq lagged on chip and hardware weakness, and the Dow proved relatively resilient thanks to healthcare and energy support. Headlines on the Federal Reserve—particularly a legal hearing involving Governor Lisa Cook—and fresh reads on inflation and regional activity added to the macro noise, while traders also weighed corporate updates from Autodesk, Marvell, Dell and Alibaba. External coverage from CNBC and Reuters corroborated the day’s macro catalysts, including a modest downward revision to consumer sentiment, a downside surprise in Chicago PMI, and an elevated focus on the Fed’s balance sheet runoff and governance backdrop (CNBC, Reuters.

Market Overview#

Intraday Indices Table & Commentary#

From the open, breadth deteriorated as the S&P 500 (^SPX) fell to an intraday low of 6,444.57 and last traded at 6,452.58, down -0.76% on below-average volume (2.61B vs. 5.11B average), per Monexa AI. The Nasdaq Composite (^IXIC) underperformed at -1.30% with heavy pressure in semiconductors and AI-linked hardware, while the Dow (^DJI) slipped a milder -0.31% as defensive healthcare and energy components offered partial ballast. The NYSE Composite (^NYA) held up comparatively better at -0.14%.

Volatility picked up with the CBOE Volatility Index (^VIX) up +8.18% to 15.61 and the CBOE Russell 2000 Volatility Index (^RVX) up +1.50% to 22.27, reflecting an intraday shift toward hedging and risk reduction in small-cap exposures, according to Monexa AI. The S&P 500’s push to a new year high of 6,508.23 yesterday gave way to profit-taking concentrated in the market’s heaviest sector—technology—whose weakness is disproportionately pulling down the cap-weighted indices.

A key catalyst for the morning’s tone was a combination of macro and micro drivers. CNBC reported a small downward revision to the University of Michigan consumer sentiment index to 58.2 versus a 58.6 estimate, and a downside surprise in the Chicago PMI, while Yahoo Finance highlighted firmer inflation signals from the latest PCE-related coverage (CNBC, Yahoo Finance. On policy, Reuters noted the Federal Reserve’s balance sheet runoff entering a more uncertain phase as the Fed’s reverse repo facility has largely drained, tightening excess liquidity conditions alongside Treasury General Account refill dynamics (Reuters.

Macro Analysis#

Economic Releases & Policy Updates#

Midway through the session, the macro tape leaned risk-off as investors digested a trio of data and policy headlines. CNBC reported that the University of Michigan’s consumer sentiment index was revised to 58.2, slightly below the 58.6 estimate, with commentators noting a still-wary consumer backdrop. Separately, the Chicago PMI surprised to the downside, consistent with softer regional manufacturing momentum that tends to track corporate capex sensitivity (CNBC. Yahoo Finance coverage emphasized that inflation indicators remained firm enough to keep the “higher-for-longer” debate active, a context that often pressures long-duration growth equities (Yahoo Finance.

Policy developments also sat front-and-center. Reuters reported the Federal Reserve’s quantitative tightening has entered a new phase as the reverse repo facility—which had functioned as a liquidity buffer—has been largely drained, leaving reserve balances more sensitive to swings from Treasury issuance and the TGA refill (Reuters. That backdrop helps explain why a modest macro surprise can translate into outsized factor moves, including today’s rotation away from high-duration tech and toward defensives and cash-flowing cyclicals. Separately, CNBC and Reuters noted courtroom developments tied to Governor Lisa Cook, whose emergency hearing ended without a ruling; the court set a quick filing schedule into next week (CNBC, Reuters. While markets typically discount near-term legal process, the Fed’s governance headlines marginally elevate uncertainty around the path of policy communication.

The labor market remains the next major macro waypoint. FactSet’s consensus, as reported in morning coverage, points to August payroll growth around 92,500 and an unemployment rate ticking up to 4.3% from 4.2% in July, with final data due next week (FactSet. Into midday, traders were reluctant to lean into risk ahead of that release, particularly with tech under pressure and volatility rising.

Global/Geopolitical Developments#

Overnight and early-morning news also fed into Friday’s intraday posture. Yahoo Finance flagged the end of the de minimis shipping exemption for certain categories, a policy shift that could reshape cross-border e-commerce economics for China-linked platforms and U.S. retailers relying on low-value parcel imports (Yahoo Finance. Complementing that, Benzinga and other outlets highlighted that Alibaba unveiled a new AI chip designed to reduce reliance on U.S. components, part of a broader U.S.–China technology rivalry narrative that continues to reprice risk across AI hardware supply chains (Benzinga. The combination of trade, technology and policy crosswinds added to today’s sector dispersion: some U.S. staples and healthcare franchises gained ground while portions of high-beta tech lagged.

Sector Analysis#

Sector Performance Table#

Two data sources show modestly conflicting reads at sector level. The sector table above, based on Monexa AI’s aggregation of intraday percentage changes across primary GICS sectors, shows broad declines led by Technology, Consumer Cyclical and Industrials. However, Monexa AI’s constituent-level heatmap and the live tape show notable gains in individual leaders within defensives and energy, including staples and major integrated oils. For example, PEP was up +1.04%, PG +0.97% and KO +0.65%, while XOM gained +1.00% and CVX +0.90%. The discrepancy can occur intraday when cap-weighted sector ETFs diverge from baskets of large gainers and losers or when different snapshots capture slightly different timestamps. Given today’s stock-level dispersion and the heavy selling in semis and hardware, we prioritize the security-level tape to explain index behavior: the concentration of weakness in tech is sufficient to pull core benchmarks lower, even as defensives and energy show pockets of resilience.

Within Technology, hardware and semiconductors were the principal drags. According to Monexa AI, MRVL collapsed -17.74% after its earnings and guidance reset, DELL fell -8.94% on margin pressure and a cautious profit outlook, ORCL slid -6.39% and AI bellwethers NVDA and AMD traded lower, with [NVDA] off -3.69% into midday. Software was mixed: ADSK rallied +7.53% after an earnings beat and guidance raise, highlighting the market’s preference for tangible execution against AI infrastructure narratives.

Financials were mixed-to-firm at the constituent level despite the sector’s slight decline in the table. BRK-B (+1.04%), AXP (+1.30%), MA (+0.78%) and money-center banks showed support, offset by brokerage pressure such as SCHW (-1.50%). The bid for diversified financials and payments suggests investors are rotating selectively toward cash-generative, rate-insulated franchises.

Healthcare leaned defensive with insurer leadership. ELV jumped +2.81% and UNH rose +0.95%, while large-cap pharma such as ABBV (+0.84%) and med-tech bellwethers like TMO (+0.71%) advanced, per Monexa AI. Biotech lagged at the margin, with MRNA down -1.61%, consistent with a quality tilt within healthcare.

Energy maintained a steady bid as crude-sensitive majors and services firms gained. [XOM] +1.00%, [CVX] +0.90% and SLB +1.25% all outperformed into midday, with smaller E&P APA up +1.63%. Utilities were a study in dispersion: EIX rallied +3.71% and PCG rose +3.10% while VST slumped -4.51%; SRE added +2.31% and NEE edged +0.18%.

Industrials were broadly weak as heavy machinery and equipment sold off. CAT dropped -4.51% and DE fell -3.38%, offsetting strength in service-oriented and aerospace names such as CTAS (+0.86%) and BA (+0.02%). Real Estate saw modest positives at the security level, with industrial REIT PLD up +0.80% and healthcare REIT WELL +0.31%, while data center REIT DLR slipped -1.25%. In Basic Materials, gold miner NEM gained +1.77% and EMN rose +2.93%, but fertilizers lagged with MOS down -2.27%.

Company-Specific Insights#

Midday Earnings or Key Movers#

The fulcrum of today’s tech weakness was Marvell Technology. Per Monexa AI, MRVL plunged -17.74% after posting in-line Q2 results but issuing a softer outlook for Q3, with multiple outlets noting guidance that underwhelmed investor expectations and concerns about the lumpiness of custom AI accelerator orders. Benzinga’s coverage emphasized that Wall Street trimmed price forecasts and questioned the near-term growth cadence even as management reiterated confidence in longer-term AI infrastructure demand (Benzinga. That repricing set the tone for broader semis and AI hardware, catalyzing declines across high-beta peers.

DELL fell -8.94% after the company reported record Q2 revenue but flagged margin pressure and issued a profit outlook that trailed some expectations, according to morning coverage. The selloff aligns with investors re-rating AI server and PC-exposed hardware names where backlog visibility and mix are under closer scrutiny in a higher-rate regime (Bloomberg.

In contrast, software execution was rewarded. ADSK rallied +7.53% after earnings and revenue beat consensus estimates and management raised guidance, with outlets citing strong demand for design software tied to AI data center buildouts and enterprise deals. Coverage from Investopedia and Zacks highlighted broad-based demand that offset the broader tech tape’s weakness (Investopedia, Zacks.

Consumer discretionary showed stark dispersion. ULTA slid -6.49% intraday despite a fresh target increase to $600 at Robert W. Baird, according to FMP coverage, underscoring that multiples in discretionary retail remain sensitive to any sign of slowing consumer intent against firmer inflation signals. Meanwhile, restaurant leader DPZ advanced +2.31% and electronics retailer BBY gained +1.93%, illustrating a preference for resilient, execution-driven consumer models.

In mega-cap tech and online platforms, NVDA fell -3.69% and AAPL eased -0.19%, while GOOGL edged +0.08%. Media and social names were mixed, with META down -1.85% and NFLX -2.17% as conference headlines and product updates competed with risk-off flows.

A key global outlier was BABA, which surged +13.31% intraday after reporting stronger-than-expected earnings in early trading and highlighting improved cloud growth. Coverage referenced the company’s push into AI infrastructure and development of proprietary chips that could reduce dependence on U.S. technology, a point emphasized in morning reports from Benzinga and other outlets (Benzinga. The move contrasted with U.S.-listed semis, underscoring that AI-related dispersion is increasingly company-specific and policy-driven.

Extended Analysis#

Intraday Shifts & Momentum#

The path from the opening print to midday reflected a classic de-risking sequence. The S&P 500 opened at 6,489.28 and quickly lost altitude to an intraday low of 6,444.57 before stabilizing just above the lows. The Nasdaq Composite exhibited similar price action, falling to 21,399.32 at its trough, as heavyweights in semis and hardware cascaded lower. According to Monexa AI, volume across the major indices ran below their 50-day intraday averages—S&P 500 volume was 2.61B shares versus a 5.11B average; Nasdaq Composite traded 4.34B shares versus a 9.09B average—suggesting the selloff, while sharp in certain pockets, was not accompanied by capitulation-like volume. That backdrop is consistent with a tactical risk trim in response to macro data and sector-specific earnings shocks rather than a wholesale liquidation.

Volatility confirmed the shift. The VIX’s +8.18% pop to 15.61, alongside a more modest +1.50% move in the Russell 2000’s volatility gauge, indicates that hedging demand skewed toward large-cap market hedges rather than a small-cap panic. With the S&P 500 having tagged a year high of 6,508.23 yesterday, some profit-taking in the market’s largest sector—technology—was more than enough to drive the headline indices lower today.

Within tech, the tape showed a decisive preference for verifiable cash flows and guidance clarity. [MRVL]’s guidance reset catalyzed a repricing across custom silicon suppliers and AI server proxies, including [DELL], while [ADSK]’s beat-and-raise attracted incremental capital. The result was heightened intra-sector dispersion: even as [AAPL] held near flat and [GOOGL] inched higher, leadership rotated away from semis into software names with clearer end-market visibility.

Outside tech, the day’s flows skewed toward ballast. Health insurers [ELV] and [UNH] outperformed, large-cap staples [PEP], [PG] and [KO] advanced, and integrated oils [XOM] and [CVX] gained with oilfield services [SLB] also firmer. Utilities were not uniformly defensive, however, as idiosyncratic moves dominated: [EIX] and [PCG] rallied while [VST] slipped. Industrials’ weakness centered in heavy machinery, with [CAT] and [DE] leading declines, potentially reflecting sensitivity to softer PMI data and a cautious capex tone captured by today’s regional survey miss.

In consumer-facing equities, price action lined up with a cautious demand narrative. Yahoo Finance and CNBC framed the macro discussion around “firmer inflation” and a still-fragile consumer sentiment read, aligning with the underperformance in select discretionary names, including [ULTA], even as niche winners like [DPZ] and [BBY] posted gains. Meanwhile, TSLA dropped -3.45%, reinforcing the broader risk-off dynamic within high-beta discretionary and auto-adjacent equities.

Cross-border and China-linked flows provided an instructive counterpoint. The end of the de minimis exemption flagged by Yahoo Finance has implications for imported low-value goods, though intraday winners such as [BABA] highlighted that company-specific AI and cloud catalysts can trump macro trade headwinds in the short run. Benzinga’s reporting on Alibaba’s new AI chip underlines intensifying competition and localization in AI hardware, a theme that both supports select China tech and complicates the outlook for U.S. suppliers exposed to export controls and customer mix concentration.

Liquidity context framed everything. Reuters’ reporting on the Fed’s balance sheet and the near-empty reverse repo facility suggests reserve balances will be more volatile as the TGA is refilled and QT persists. In practice, that makes factor markets more sensitive to data surprises, and it raises the bar for richly valued, long-duration assets—precisely the pocket of the market that led today’s pullback. With FactSet’s consensus calling for an uptick in unemployment to 4.3% and ~92,500 jobs added in August, the labor print next week remains the next decisive macro test for risk appetite.

Conclusion#

Midday Recap & Afternoon Outlook#

By midday, the market’s message was clear: technology’s size means even a modest sector drawdown can drag the broader indices, particularly when the catalyst is an earnings-guidance shock that questions the near-term cadence of AI hardware spending. According to Monexa AI, the S&P 500 was down -0.76%, the Nasdaq -1.30% and the Dow -0.31%, with the VIX up +8.18%. Under the surface, defensive leadership in healthcare and staples, resilience in energy, and a mixed financials tape offered partial offsets, but not enough to counterbalance semiconductor and hardware weakness tied to [MRVL], [DELL], [ORCL], [NVDA] and peers.

Macro contributed to the de-risking: CNBC’s reporting on a softer consumer sentiment revision and a Chicago PMI miss, Yahoo Finance’s emphasis on firm inflation readings, and Reuters’ focus on a liquidity environment shaped by a drained reverse repo facility and ongoing QT all supported a higher bar for long-duration growth equities. Legal headlines around Fed Governor Lisa Cook’s hearing introduced additional policy noise without a definitive ruling, sustaining uncertainty into next week (Reuters, CNBC.

Into the afternoon, investors will watch whether the tech-led drawdown stabilizes on light volume or extends into the close as managers reduce risk ahead of the long weekend. The near-term calendar is thin until next week’s labor data, where FactSet’s consensus calls for unemployment to edge to 4.3% and nonfarm payrolls to rise by ~92,500. Against that setup, the bar for positive surprise within AI hardware appears higher, while execution stories in software, insurers, staples and integrated energy continue to attract defensive capital.

Key Takeaways#

• According to Monexa AI, the S&P 500 (-0.76%) and Nasdaq (-1.30%) traded lower into midday as technology—especially semiconductors and hardware—led the decline; the VIX rose +8.18% to 15.61.
• Sector data present a mixed picture: a Monexa AI sector snapshot shows broad declines, yet constituent-level tape reveals defensive and energy pockets advancing, with [PEP] +1.04%, [PG] +0.97%, [KO] +0.65%, [XOM] +1.00% and [CVX] +0.90%.
• [MRVL] (-17.74%) set the tone for AI hardware weakness after guidance underwhelmed, while [DELL] (-8.94%) compounded hardware pressure; [ADSK] (+7.53%) was the notable tech gainer on a beat-and-raise.
• Macro catalysts included a softer consumer sentiment revision and a Chicago PMI miss (CNBC), ongoing inflation concerns spotlighted by Yahoo Finance, and Reuters’ coverage of a liquidity backdrop shaped by the near-empty RRP and QT.
• Policy headlines around Fed Governor Lisa Cook’s hearing concluded without a ruling, maintaining uncertainty into next week (Reuters). The labor report remains the next macro waypoint, with FactSet consensus for an unemployment uptick to 4.3% and ~92,500 job gains.
• For positioning, the market is rewarding visibility and cash flows over distant growth narratives. Given today’s dispersion, investors focusing on balance-sheet strength and guidance credibility—particularly in software execution, managed care, staples and integrated energy—are finding relative stability while trimming concentrated AI hardware risk.