United States chip stocks stumble amid AI questions
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U.S. semiconductor shares have come under pressure at the start of July after a powerful rally driven by artificial intelligence demand. The Philadelphia Semiconductor Index has dropped more than 11% since hitting a record high in June, though it remains up about 83% for the year. Large chipmakers including Nvidia, Intel, Qualcomm, Marvell Technology, Micron and AMD have all been affected. Recent volatility reflects rich valuations and uncertainty over how long AI-related spending can expand. LSEG Lipper data show roughly $11 billion exited U.S. semiconductor funds in the week ended June 24, following about $12 billion in inflows over the prior two weeks. Analysts still broadly expect robust hyperscaler capital expenditure and see potential for continued earnings growth, with some U.S. brokerages raising price targets on leading chip names.
More context
Timeline
- June 2024 Philadelphia Semiconductor Index hits record
- June 2024 Semiconductor index begins 11% pullback
- Mid-June 2024 About $12 billion semiconductor fund inflows
- Week ended June 24 2024 $11 billion semiconductor fund outflows
- June 2024 Short interest reaches three-year sector high
- By 2027 BofA projects $1.5 trillion AI infrastructure capex
- This year S&P 1500 chip earnings expected more than double
- Early July 2024 Investors reassess AI-driven chip rally
Why it matters
If you're invested in chip stocks, you've likely seen some losses recently. This is due to uncertainty about how long AI demand can drive growth. It's a good time to review your portfolio and consider your risk tolerance.
JQJO Editorial Desk · Human reviewed · AI assisted. Report a correction.
