Market Sell-Off Impacts Major Stocks
This week, several well-known stocks faced significant drops amidst a broader market sell-off. The three key U.S. stock indices all slipped, with rising worries about how fast-paced advancements in artificial intelligence might affect corporate earnings. Software companies were among the first to feel the impact, but soon after, shares of gaming, insurance, real estate, media, and logistics firms followed suit. Notably, Netflix and Fox saw declines of 6.5% and 11.6%, respectively; analysts are concerned that AI-generated content could pose a threat to both streaming and traditional platforms.
According to CNBC Pro, Netflix’s stock is viewed as technically oversold, which could mean a bounce back could happen soon. A stock is deemed oversold when the 14-day relative strength index (RSI) dips below 30. Conversely, a stock with an RSI above 70 might indicate it’s overbought, suggesting it’s time to sell. As for Wall Street’s most oversold stocks, Fox’s Class A shares have an RSI of nearly 18.6, while Netflix’s also appears oversold at about 24. Wells Fargo analyst Stephen Cahall commented to clients that the drop in media stocks might be excessive, pointing out that Fox primarily focuses on live sports and news, making their fear of the AI threat seem misplaced.
Among the most oversold stocks was DoorDash, which had an RSI of 16.45, marking a decline of over 12% since the week began. Its earnings results are expected on Wednesday. Bank of America maintained a buy rating on DoorDash, expressing confidence that strong first-quarter figures could trigger significant follow-through if margins stay consistent for the year. The bank also indicated limited AI risks for DoorDash due to its solid relationships within the restaurant and delivery networks.
Other oversold stocks included Intuit, Booking Holdings, and Amazon. Amazon, part of the so-called Magnificent Seven, dropped 5.5% this week, pulling its year-to-date loss close to 14% as technology stocks have had a rocky start in 2026.
Meanwhile, some stocks are viewed as overbought, like real estate firms Equinix and Texas Pacific Land, both having high RSI readings at approximately 85 and 82, respectively. Equinix’s stock rose 12.7% this week following a positive outlook announcement for the first quarter and marking its 11th straight year of increasing dividends—driven by a surge in demand for data centers. Other companies like Verizon, Marriott International, and Motorola Solutions also made the overbought list.
