Insiders Sold $6.4B. Then AI Stocks Cracked.

Last week was a rotation out of AI-infrastructure tech, not a market-wide crash. The money went into staples, energy, healthcare and defense. Insider selling in tech ran heavy before the drop, and Congress barely traded these names.

The short version

• Two hot inflation reports and $100 oil hit tech hard: chips (SMH) fell 10.5% and tech (XLK) 7.7%.
• The equal-weight S&P (RSP) actually rose 0.5%. The damage was concentrated, not broad.
• Insiders sold about $6.4B of tech stock in September and bought almost none.

1. What triggered it

• Hot CPI on Wednesday. September CPI came in at 3.7% against 3.6% expected, and core CPI rose 0.3% for the month. The 10-year yield jumped to about 5.33% (Yahoo Finance).
• Hot PPI on Thursday. A second hot inflation report put a Fed rate hike back in play, but the Dow still gained about 556 points as money rotated out of tech (Yahoo Finance).
• Oil on Friday. Brent tested $110 and US crude topped $100 after Houthi attacks on Saudi Aramco and more Iranian attacks on ships in the Strait of Hormuz. The S&P tech sector fell more than 3% that day (TheStreet).

2. Where the money went (Oct 9 to Oct 16 close)

Defense stocks also rose about 8% (Lockheed, Northrop), and long-dated Treasuries (TLT) gained 2.6%. The sell-off hit AI infrastructure much harder than the biggest platforms. CoreWeave fell 25%, Supermicro 24%, Dell 23% and Applied Materials 19%. Microsoft and Meta lost only about 1%, and Apple gained 2%.

4. Insiders (SEC Form 4 filings)

• Heavy selling before the drop. Across the 45 names we checked, insiders sold about $6.4B of stock on the open market in September and bought almost nothing. The biggest sellers were in Dell (Silver Lake), Nvidia (one director sold about $298M on 9/18) and Broadcom.
• CoreWeave kept selling into the drop. Its CFO and Chief Revenue Officer each sold about $1.7–1.8M on Oct 12–13, after the CEO sold $6.9M on Sep 30.
• Micron's big number isn't a sale. The CEO's roughly $74M on Oct 13 is shares held back to cover taxes on vesting stock, not selling on the open market.
• One real buy. An Oracle director bought $3.5M of stock at $139 on Sep 29. That is the only open-market insider purchase we found in these names.

5. Congress

Trading was thin and small. Gilbert Cisneros bought TSM and sold WDC, Maria Elvira Salazar bought META, and Pete Sessions' spouse sold over $100K of AAPL, all in mid-to-late September. Across all stocks, the only group buying was 3 members in MSFT (at least $17K combined). Members can wait up to 45 days to disclose, so trades made during last week mostly won't show up until late November.

This was a targeted exit from AI hardware into defensive and real-asset sectors, driven by inflation and oil rather than a broad loss of confidence. Two levels decide whether it keeps going: whether SMH holds above its 60-day low (it's now 15% off its high), and whether oil stays above $100.

Data note: September Form 4 history runs through Sep 30; October insider filings above were checked company by company. Congressional trades are subject to a 45-day disclosure lag.