Analysis: After the chip stock sell-off, the historical probability of a rebound is nearly 70%, with an average 3-month return of +23.3%

BlockBeats news, November 7 - This Thursday, the Philadelphia Semiconductor Index (SOX) fell 12%, and the S&P 500 dropped 4%, marking the second-worst single-day performance for the SOX since its inception (the worst was in early March 2020 during the COVID-19 outbreak, and the third-worst was during the dot-com bubble). However, the selloff did not persist on Friday, and the index has strongly rebounded by over 4%. Markets are expected to further recover sentiment over the weekend.

Historical data from Deutsche Bank shows that after the SOX's 9 worst trading days in the past, the average returns over the following 3 months and 12 months were +23.3% and +48.8%, respectively, with positive returns in 6 out of 9 instances, indicating that significant rebounds often occur after such extreme selloffs.