Goldman Sachs analyst Rich Privorotsky stated on October 13, 2026, that the AI sector selloff represents a rotation rather than a liquidation, with investors reshuffling their AI bets rather than abandoning them. The decline traced back to weakness at CXMT, a Chinese memory manufacturer, and spread to major chipmakers: Samsung fell 8%, SK Hynix slid 10%, and Kioxia dropped 13%, while the KOSPI declined 5.5%. The rotation thesis is supported by a divergence between Nasdaq futures, which fell approximately 70 basis points, and Russell futures, which rose around 30 basis points, suggesting money moved between sectors rather than leaving the market entirely. Goldman noted that hedge funds have substantially reduced broad technology exposure while maintaining positions in select mega-cap stocks, indicating a narrowing but not disappearance of the AI trade.
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