Midday Market Intelligence: froth?

Research evidence excerpt

Midday Market Intelligence: froth?

Equity Research

23 June 2026 | 12:48PM EDT

US stocks are trading definitively lower Tuesday, following a 10% sell-off in Korea Chris Hussey

+1(212)902-7564 |

overnight, as investors assess just how far and fast Tech stocks have risen this year chris.hussey@gs.com

Goldman Sachs & Co. LLC

even as earnings have for the most part matched the stock price gains.

Sarah Herr

+1(212)357-0094 | sarah.herr@gs.com

... or something more? Kshitij Garg

All but one of the 12 Tech stocks down 8% or more today are still up double digits +1(212)934-7434Goldman Sachs India| kshitij.garg@gs.comSPL

ytd with most still having more than doubled for the year — illustrating how today’s

sell-off appears to be more of a ‘skimming off the froth’ of an exuberant period of

stock price gains, than a fundamental reassessment of the AI infrastructure trade.

Investors are not necessarily selling the index en masse, but rather reassessing how

much they should pay for the stocks that are most favorably exposed to the data

center build out era — a reasonable thing to ask of any stock that has doubled (or

more) in 6 short months.

Does today’s price action suggest that markets have gotten ahead of themselves?

Not necessarily. Dominic Wilson writes in a fresh Strategy note this morning, “Where

the AI Boom Stands Now—Markets Ahead of the Macro,” that markets may indeed

be ignoring a non-Tech economy that is growing slower than it should. But the

earnings momentum we are seeing in AI-exposed stocks is simultaneously unlikely to

slow anytime soon (see our chart of the day below for more on what’s priced in).

And that earnings momentum should sustain the rally for now. Over time, we may

see a slowdown in AI capex growth which stalls out the earnings momentum, but Ben