Stocks in the Philadelphia Semiconductor Index were on course to lose more than $1 trillion in market value after a six-session decline of about 10%. Higher rate expectations, elevated valuations and AI financing demands weighed on the sector.
Chip stocks are on course to lose more than $1 trillion in market value, Bloomberg reported on October 14, after the Philadelphia Semiconductor Index slid about 10% over six sessions. The index fell 3.1% on Wednesday, putting it on track for its longest losing streak since May 2025.
Higher interest-rate expectations, elevated valuations and the financing demands of AI infrastructure weighed on the sector. Hotter-than-expected September inflation reinforced expectations for further Federal Reserve rate increases.
Arm, Applied Materials and Intel lead the declines
More than half of the index's members had fallen at least 10% over the six sessions. Arm dropped almost 20%, Applied Materials about 15% and Intel 11%. GlobalFoundries was the only constituent to gain during that period.
Broadcom CEO Hock Tan had warned earlier in the week about potential funding constraints, Bloomberg reported. He compared some investors pursuing the AI boom to gamblers.
UBS sees a reassessment, not a breakdown
UBS Chief Investment Office's Ulrike Hoffmann-Burchardi attributed the pressure to factors including AI competition, financing needs and interest rates. She described the decline as a reassessment of expectations rather than a fundamental breakdown in the AI investment outlook.
Investors were also awaiting an Anthropic presentation in San Francisco later Wednesday for indications of its revenue pace and demand for AI spending.
Source: Crypto Briefing
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