Michael Burry Warns Nasdaq 100 Faces Reversal as Chip Index Jumps Nearly 70%
Updated
Updated · Bloomberg · May 11
Michael Burry Warns Nasdaq 100 Faces Reversal as Chip Index Jumps Nearly 70%
5 articles · Updated · Bloomberg · May 11
Michael Burry said the Nasdaq 100 is heading for a dramatic reversal after a “parabolic” tech surge, arguing valuations have reached unsustainable levels.
Nearly 70% gains in the Philadelphia Stock Exchange Semiconductor Index since late March are central to his warning, with chip stocks driving the latest leg of the rally.
In a Substack post, Burry said the setup resembles the 2000 dot-com peak just before it burst, extending earlier comparisons he made to the AI-fueled boom.
Burry has also urged investors to trim parabolic tech positions and raise cash rather than short aggressively, framing the current run-up as a potential precursor to a broader stock crash.
With AI giants being highly profitable, why does Michael Burry see a repeat of the dot-com bust?
As AI stocks dominate indexes, are passive investors making a huge unintended bet on a single sector?
Could cheaper Chinese AI models burst the massive spending bubble of American tech giants?
AI Mania or Market Meltdown? Michael Burry, the Shiller CAPE Ratio, and the 2026 Tech Stock Surge
Overview
In May 2026, Michael Burry warned that the surge in AI-driven tech stocks, fueled by investors pouring capital into AI-linked shares, resembles the late stages of the dot-com bubble. This rally pushed major U.S. equity indexes to record highs, mainly led by semiconductor companies and large tech firms building AI infrastructure and software. Enthusiasm for generative AI has driven valuations higher, but Burry cautions that excessive optimism and stretched prices could lead to a sharp market pullback if sentiment changes. His warning highlights the risk of a disconnect between soaring market excitement and the underlying economic reality.