CNBC Daily Open: Rising geopolitical risk

This report is from today's CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe  here .

Nasdaq's worst session
The Nasdaq Composite suffered its worst session since December 2022, plunging nearly 3%, as semiconductors came under pressure amid reports of tougher trade restrictions. The S&P 500 also retreated as the rotation out of technology stocks continued. Meta Platforms tumbled 5.7%, while Big Tech peers Netflix and Microsoft dropped more than 1% and Apple slid 2.5%. Bucking the trend, the Dow Jones Industrial Average closed above 41,000 for the first time. The small-cap focused Russell 2000 slipped 1%, ending its five-day win streak. The yield on the 10-year Treasury was little changed, while U.S. oil prices rose 2.6%.

Chip tensions
Global chip stocks tumbled amid potentially tighter restrictions on U.S. exports to China and escalating geopolitical tensions. U.S.-listed shares of ASML and Taiwan Semiconductor Manufacturing Co plunged 12% and 8%, respectively. The declines followed a Bloomberg report that the Biden administration is weighing tougher restrictions on companies exporting technology to China. Nvidia shares slumped more than 6%, while Arm Holdings, Lam Research, Applied Materials and Advanced Micro Devices slid about 10% each. Qualcomm slid almost 9%. The VanEck Semiconductor ETF dropped more than 7%, its biggest daily loss since 2022.

Getting closer
Federal Reserve Governor Christopher Waller suggested that interest rate cuts could come soon, barring major surprises in inflation and employment data. "I believe current data are consistent with achieving a soft