Applied Materials Tumbles 4.93% on $2.04B Surge in Volume, Ranking 45th Amid Regulatory Scrutiny

Applied Materials (AMAT) closed down 4.93% on July 31, 2025, with a trading volume of $2.04 billion—a 168.02% surge from the prior day—ranking 45th in market liquidity. The decline accelerated amid intensified regulatory scrutiny on building materials used in semiconductor manufacturing, sparking investor concerns over potential revenue compression and compliance costs. Analysts noted the selloff reflects broader sector jitters, as economic uncertainties amplify risk aversion in cyclical tech stocks.

Regulatory pressures on quality control measures for construction-related applications have overshadowed the company’s core wafer fabrication business. While Applied Materials emphasized innovation and product expansion, the market remained wary of compliance-driven cost overruns. Technical indicators showed the stock trading near its 200-day moving average at $170.66, with oversold conditions suggesting potential short-term rebounds. However, key support levels at $174.51 and $179.07 remained under test amid thin volume.

Historical backtests of AMAT’s performance following a -6% intraday plunge revealed a 55.61% win rate over three days, rising to 61.98% at 30 days. The average return was positive across all timeframes, with a maximum 8.23% gain observed over 30 days. While volatility persisted, the data suggested medium-term recovery potential, provided regulatory clarity and sector demand stabilize. Investors were advised to monitor the $170.66 threshold for further directional cues.

The backtest of a high-liquidity trading strategy from 2022 to July 30, 2025, generated a 166.71% return, outperforming the benchmark by 137.53%. This approach, focused on top 500 stocks by daily volume, highlighted the role of liquidity-driven momentum in short-term gains, underscoring the strategic value of high-turnover assets in volatile markets.