#GlobalTechSell-OffHitsRiskAssets

Global Tech Sell-Off Hits Risk Assets: A Wave of De-Risking Sweeps Markets in Early 2026

The first week of February 2026 has delivered a stark reminder of how interconnected modern financial markets have become. A sharp sell-off in technology stocks, fueled by mounting concerns over the sustainability of the artificial intelligence (AI) investment boom, has rippled outward to hammer riskier assets across the board—including cryptocurrencies, precious metals like silver, and other high-beta investments.

The catalyst traces back to Big Tech's aggressive capital expenditure announcements. Major players such as Alphabet (Google's parent) projected up to $185 billion in 2026 spending—far exceeding Wall Street estimates—while Amazon revealed plans for $200 billion, sparking fears of margin compression, overinvestment, and potential disruption from emerging AI tools like those from Anthropic. These revelations triggered a rapid reassessment of valuations in software, chipmakers, and AI-exposed sectors. The Nasdaq Composite endured its worst three-day slide since April, shedding over $1 trillion in market value at one point, with the broader S&P 500 and global equities gauges following suit in multi-day declines.

This tech rout quickly evolved into a broader "risk-off" rotation. Investors fled speculative positions, viewing assets like cryptocurrencies as extensions of the same high-growth, high-uncertainty narrative. Bitcoin, often correlated with tech and software stocks (with correlations to indices like the iShares Expanded Tech Software ETF reaching 0.73 or higher), plunged dramatically—briefly dipping below $61,000 before partial recoveries pushed it back toward the $70,000 range. The cryptocurrency erased nearly half its value from its October 2025 peak above $126,000, with leveraged positions liquidating en masse and amplifying the downside. Other digital assets faced even steeper percentage drops as traders reduced exposure to higher-beta names.

The contagion didn't stop at crypto. Silver prices cratered as much as 18% in sessions, reflecting a flight from commodities tied to industrial and speculative demand. Gold held up better as a traditional safe haven, but overall, the mood shifted toward caution. Weak U.S. labor market data added fuel, raising doubts about economic resilience and the Federal Reserve's path on interest rates—perceived as "hawkish" cuts that favor safety over speculation.

By February 6–7, signs of stabilization emerged. A sharp rebound lifted the Dow Jones Industrial Average above 50,000 for the first time, with gains of over 1,200 points in one session, as dip-buyers stepped in and rotation flowed toward more cyclical and defensive sectors. Tech names like Nvidia and Microsoft recouped some losses, and Bitcoin climbed double digits intraday. Yet the week closed mixed, with the Nasdaq still down meaningfully and volatility elevated.

This episode underscores a key dynamic in 2026 markets: Bitcoin and crypto, once seen as decoupled "digital gold," now move in tight tandem with tech equities due to shared institutional ownership, growth-oriented narratives, and sensitivity to liquidity conditions. The sell-off highlights the risks of concentrated bets on AI-driven growth and the speed at which sentiment can flip when valuations face scrutiny.

For investors, the takeaway is clear—diversification across sectors and asset classes remains essential amid persistent volatility. While some view this as a healthy correction within a longer bull cycle, others warn of prolonged pressure if AI spending doubts deepen or macroeconomic headwinds intensify. As markets digest these moves, attention turns to upcoming earnings, policy signals, and whether the dip-buying momentum can sustain a broader recovery.