ProShares UltraPro QQQ (TQQQ), a leveraged ETF that tracks the Nasdaq-100, tumbled 5.01% in intraday trading on Wednesday, as a confluence of tech-sector headwinds rattled investor confidence and sparked a broad risk-off move.
The sell-off was driven by intensifying concerns over the sustainability of the artificial intelligence boom. Disappointing quarterly results from South Korean memory chip giant SK Hynix, a key supplier to Nvidia, fanned fears that AI-related investment may be cooling. The earnings miss triggered a sharp decline in global chip stocks, with the Philadelphia Semiconductor Index on track for its worst monthly drop since 2008. This dragged down major tech names and heavily impacted the Nasdaq-100, to which TQQQ is triply leveraged.
Additionally, market sentiment was dampened by caution ahead of the Federal Reserve’s interest rate decision and earnings reports from mega-cap tech companies Microsoft and Meta, both due after the close. Escalating tensions in the Middle East also drove oil prices up more than 3%, stoking inflation worries and further eroding appetite for risk assets. The combination of these factors created a perfect storm that sent TQQQ sharply lower.
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