November 04, 2026 – Oracle’s $20 billion funding plan and Marvell’s all-stock bid for Lumentum pushed chip stocks deeper into a bear market before a partial Election Day rebound.
In Summary
The PHLX Semiconductor Index closed at 10,328.33 on 2 November, 21.9% below its 6 October close.
Oracle filed to sell $10 billion of stock alongside $10 billion of senior notes; its shares fell 8.76%.
Marvell agreed to buy Lumentum for 4.5 Marvell shares each; the stocks fell 12.72% and 18.59%.
Lumentum closed about 11% below the deal’s implied value, a sign of doubt among investors.
Chips rebounded on 3 November ahead of AMD’s results, yet the chip index remains well off its highs.
AI stocks took another hit on Monday before bouncing on Election Day. The PHLX Semiconductor Index closed at 10,328.33 on 2 November, Nasdaq data shows. That left the chip gauge 21.9% below its 6 October close and 29.4% below its June record. Monday’s moves showed how quickly sentiment toward AI stocks can shift once large funding needs surface.
Why AI stocks sold off on Monday
Two deals did most of the damage. Oracle filed on 2 November to sell $10 billion of common stock. At the same time, it launched a $10 billion offering of senior notes. Its shares fell 8.76% to $119.22.
The bond sale spans six tranches, from floating-rate notes due 2029 to fixed-rate notes due 2046. Meanwhile, the stock sale adds new shares just as the price had already slid from $144.77 on 6 October.
The filing shows why investors flinched. As of 31 August, Oracle carried $236.1 billion in total liabilities. That figure included $125.3 billion of senior unsecured borrowings. The company says it may use the new cash for capital spending, debt repayment and other general purposes.
Marvell delivered a second shock. On 1 November, it agreed to buy Lumentum in an all-stock deal. Each Lumentum share will convert into 4.5 Marvell shares. Marvell fell 12.72%, while Lumentum dropped 18.59%.
The merger terms also carry teeth. Marvell would owe Lumentum a $5.8 billion fee in certain cases, including if its board withdraws support. In addition, Marvell shareholders must approve the share issuance.
Notably, a wide deal spread opened on the first day of trading. At Monday’s close, the offer valued each Lumentum share at about $771. Yet Lumentum traded at $684.40, roughly 11% below that level. Such a gap suggests investors see risk in the deal or in Marvell’s share price.
Where AI stocks stand after the rout
The damage spread across the AI supply chain. AMD fell 7.52%, and Micron lost 5.78%. Nvidia and Broadcom held up better, slipping 1.26% and 1.18%. Server and storage makers also fell, as Dell lost 7.43%, Seagate 7.88% and Western Digital 7.52%. Meanwhile, the Nasdaq Composite fell 1.07% to 25,164.36, according to FRED data.
Across the wider market, a similar split appeared. The S&P 500 slipped 0.51% to 7,541.40, while the Dow rose 0.41% to 51,983.98. In other words, investors sold tech while buying other parts of the market.
The longer view looks harsher. Since 6 October, Marvell has lost 40.3% and Lumentum 39.6%. AMD is down 28.1%, Micron 20.3% and Oracle 17.6%. Even Nvidia has given up 15.5%.
Still, the yearly picture remains strong. The chip index remains up about 46% in 2026, from 7,083.13 at the end of 2025. Similarly, the Nasdaq-100 sits 10.4% below its 6 October record but 10.9% higher for the year.
Rates, earnings and the next test
Bond yields offer little relief. The 10-year Treasury yield ended Monday at 4.91%, while the 30-year yield stood at 5.28%. Higher long-term rates raise the bar for richly valued tech shares.
Tuesday brought a partial rebound. By early afternoon in New York, the chip index had gained about 2.8%. AMD rose about 5% ahead of its results after the close, and Oracle recovered about 6%. Investors will watch AMD’s data center sales and outlook closely. For AI stocks, that report and the midterm results now set the next test.
