Chip ETF Bounces Back as Memory-Price Surge Reshapes the Semiconductor Trade
Published on 07/31/2026 at 15:42 | Redaktion boerse-global.de
The whipsaw in semiconductor stocks this week has left investors with a split screen: a brutal multi-day selloff that erased more than a trillion dollars in sector value, followed by a sharp Friday rebound fueled by upgraded industry forecasts and blockbuster earnings from the AI supply chain.
The VanEck Semiconductor UCITS ETF climbed 3.21 percent to 91.56 euro on Friday, recovering from a Thursday close of 88.71 euro. The bounce, however, does little to close the gap to the fund's 52-week high of 111.18 euro, reached on June 30 — the ETF still sits roughly 17.65 percent below that peak. The 50-day moving average of 98.05 euro also remains well above the current price, underscoring how far the recent slide has pushed the fund below its recent trading range.
A selloff driven by sentiment, not fundamentals
The damage from the preceding week was broad and deep. Intel shed nearly 6 percent, while AMD dropped over 8 percent. Memory-chip makers fared worse: Micron and Seagate each lost more than 8 percent, Western Digital fell close to 7 percent, and Sandisk tumbled 14 percent. The pain extended across Asia, where Samsung and SK Hynix plunged 13.4 percent and over 14.7 percent respectively, dragging down chip suppliers worldwide that have tied their fortunes to AI infrastructure buildout.
Analysts have been careful to frame the selloff as a crisis of confidence rather than a deterioration in business conditions. Michael Field, chief strategist at Morningstar, attributes the decline "largely to sentiment rather than fundamentals," describing it as a loss of trust in AI stocks, which remain growth names whose valuations hinge on expectations for future cash flows.
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Several factors amplified the selling pressure. The spectacular initial public offering of Chinese memory-chip maker CXMT in Shanghai stoked concerns that its rapid expansion could depress memory prices. A report about mass production at a key chip fabrication facility operated by a Chinese state-owned enterprise added fuel to the fire, as did fears of renewed US interest rate hikes.
Omdia's dramatic revision changes the calculus
Friday's rebound was anchored by a striking data point from market research firm Omdia, which on July 30 raised its 2026 semiconductor revenue forecast by a staggering 94.1 percent year-over-year. The firm cites exceptional demand for AI hardware, particularly DRAM and NAND memory chips, as the primary driver.
Omdia projects that memory ICs will account for more than half of total semiconductor revenue for the first time in 2026. The research house expects shortages in high-bandwidth memory and advanced chip packaging to persist at least through 2027, keeping prices elevated — a dynamic that directly benefits the heavyweight positions within the ETF.
The earnings calendar reinforced that narrative. Amazon, reporting on July 30, saw its AWS cloud division grow 37 percent, the fastest pace in 18 quarters. CEO Andy Jassy described demand for AI and custom chips as "booming," and the company raised its 2026 capital expenditure budget to 220 billion dollars, a 20 billion dollar increase over prior plans. Jassy explicitly cited rising memory-chip prices as a reason for the higher spending.
Samsung Electronics delivered a record second quarter with revenue of 171.5 trillion won and operating profit of 89.5 trillion won. The company's memory division posted its best result ever and confirmed it has begun shipping initial HBM4E samples to key customers.
Not all signals point the same direction
The earnings season has also exposed the strains beneath the AI boom. Apple reported record June-quarter revenue of 109.4 billion dollars but warned of growing supply constraints, with management expecting tight capacity at advanced chip nodes and surging memory prices to weigh on September-quarter growth.
Intel offered a more complex picture. Revenue rose 25 percent to 16.1 billion dollars, but the company posted a GAAP net loss of 11 billion dollars, driven by a non-cash charge of 12.5 billion dollars related to its CHIPS Act agreement. Operationally, Intel beat expectations handily, with its data-center and AI business growing 59 percent.
A structural shift in sector dynamics
The recent turbulence points to a deeper realignment within technology markets. Software and semiconductor stocks moved largely in lockstep for years — that relationship has now broken down. In 32 of the past 60 trading days, the corresponding ETFs moved in opposite directions, the highest divergence since their 2001 inception. The 60-day correlation has collapsed from a long-term average around 0.75 to nearly zero.
The broader market has absorbed the shock with relative calm. Roughly 72 percent of S&P 500 constituents trade above their 200-day moving average, the strongest market breadth since December 2024. That suggests investors are treating the semiconductor slide as a sector-specific rotation rather than a warning about the wider market.
Buyers step in where others see risk
Not everyone reads the pullback as a red flag. Aberdeen views the selloff as a buying opportunity rather than evidence of weakening fundamentals, arguing that lower valuations offer a chance to acquire "high-quality companies at more attractive prices." Standard Chartered remains constructive over the long term, with equity CIO Sundeep Gantori noting the market is "big enough for multiple players to coexist." The bank expects memory-chip prices to peak only in 2027, but believes the risk-reward profile has already improved at current valuations.
Additional support came from Arm Holdings, which reported quarterly revenue of 1.29 billion dollars, and TSMC, which gave the all-clear for its JASM fabrication facility in Japan on July 28 following seismic activity. The fund's annualized volatility sits near 62 percent, a reminder that sharp swings in either direction remain the norm in this sector. Over the past twelve months, the ETF still shows a gain of 117.87 percent, and it trades 30.52 percent above its 200-day average — evidence that the long-term uptrend remains intact despite July's turbulence.
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