A sell-off like Friday’s is ‘rarely the top’ of a rally, says Wharton’s Jeremy Siegel Finance professor Jeremy Siegel described Friday’s technology sector sell-off as a typical reaction to a parabolic rise in stock prices, suggesting it’s unlikely to signal a prolonged correction. He believes the AI-driven market gains are distinct from past bubbles due to potential productivity growth, comparing it to the Industrial Revolution. However, Siegel cautioned that these high stock prices are only justifiable if companies can maintain inflated earnings permanently, highlighting the cyclical nature of chip stocks.

• Friday’s tech sell-off is a common reaction to parabolic stock price rises, not typically the start of a prolonged correction.
• The Nasdaq experienced its worst weekly decline since April 2025, though it remains up 10.6% year-to-date.
• Semiconductor stocks, despite significant year-to-date gains, saw a notable drop, with some ETFs experiencing their worst single-day or weekly moves in years.
• Siegel likens the AI revolution and its market impact to the Industrial Revolution, differentiating it from previous market bubbles.
• He warns that inflated stock prices, especially in chip stocks, are only sustainable if earnings increase permanently, not just for a temporary surge.