Recently, the trend of the US stock market has been generally weak. The market has begun to discuss the bursting of the technology stock bubble and the style shift between large and small cap stocks.

Chip stocks have suffered heavy losses.

This week, the Nasdaq and S&P 500 index have continued to fall, recording the largest weekly decline since April.

Technology stocks were sold off, and the technology sector of the S&P 500 index fell nearly 6% in a week, with a market cap shrinking by about $900 billion.

The seven giants fell sharply, with Amazon falling more than 5%, Google and Meta falling more than 4%, Microsoft and Tesla falling more than 3%, and Apple falling more than 2%.

The loss of chip stocks is most obvious, with the semiconductor index falling nearly 9% during the week.

Individual AMD fell more than 16%, Micron Technology fell more than 14%, Taiwan Semiconductor fell more than 11%, ARM fell more than 9%, Qualcomm and Nvidia fell more than 8%, Broadcom fell more than 7%, and Intel fell more than 4%.

At the same time, although the small cap stock market has cooled down, the Russell 2000 index has risen more than 1.68% this week.

A crucial week.

Next week is crucial for the future of the US stock market, as several large technology companies will release their quarterly earnings.

Tesla and Google will be the first of the seven giants to release their performance data after the US stock market next Tuesday.

Analysts may focus on the progress of Tesla's autonomous driving taxi plan, demand for electric vehicles, and delve into the details of Google's revenue from AI.

Zacks, a well-known investment research company in the United States, expects Tesla's earnings per share to be $0.62 in the last quarter, a year-on-year decrease of 31.9%; and revenue to be $25.13 billion, a year-on-year increase of 0.8%. Google's cloud computing service revenue is expected to be $10.08 billion, up 25.5% year on year.

The following week, Microsoft, Meta, Amazon, and Apple will also release their earnings reports. Nvidia will not release its performance data until the end of August.

Glen Smith of GDS Wealth Management said: "If we see strong technology earnings combined with weak inflation, this may reverse the recent weakness in the market and trigger a new round of gains."

Anthony Saglimbene, chief market strategist at Ameriprise Financial, believes that the inflation data earlier this month caught many investors off guard, almost solidifying expectations of a rate cut in September and triggering a market turn.

Saglimbene suggests that investors use the partial pullback in technology stocks as an opportunity for long-term positioning. He believes that the upcoming earnings may ease the selling pressure on large technology companies.

Wall Street bullish.

For the US stock market's pullback, Wall Street generally expects it but remains bullish in the long run.

Goldman Sachs strategists said that there is a risk of a stock market pullback this summer. The market is more likely to see a pullback in the second half of the year rather than a bear market.

According to Goldman Sachs analysis, this may be the result of the combined effect of weakening economic data, a more dovish Federal Reserve, and rising uncertainty in policy before the US election.

Bank of America's strategist stated that as investors become more convinced that the Federal Reserve will cut interest rates in September, and that Trump will win the election, investors are rushing into the US stock market.

Bank of America cited EPFR Global data and wrote that US stock funds absorbed about $45 billion in the week ending Wednesday, the fourth largest inflow ever. Small stock funds saw an inflow of $9.9 billion, the second largest ever, and large stock funds saw an inflow of $27.4 billion.

Bank of America also stated that the stock market may fall after the Federal Reserve cuts interest rates, calling it a "buy the rumor, sell the fact" opportunity.

Bank of America also has a bullish outlook on bonds, expecting that any new tariffs implemented by Trump in the next year will "lead to deflation rather than inflation."

UBS has raised its target price for the S&P 500 index for the fourth time this year and now predicts that the index will close at 5,900 points this year, with a bullish target of 6,500 points, meaning it could rise by an additional 7%-18%.

UBS believes that the market background is still favorable due to the following factors: 1) steady and expanding profit growth, 2) slowing inflation, 3) the Federal Reserve's shift to interest rate cuts, and 4) a surge in investment in artificial intelligence infrastructure and applications.