Nasdaq-100 is on the edge of correction territory as semiconductor stocks take another beating - Morningstar

In July 2026, the U.S. tech stock market showed signs of significant correction, with the Nasdaq-100 approaching correction territory. This trend is primarily driven by continued declines in the semic... Read original →

The semiconductor industry is undergoing a systemic correction triggered by the cooling of the AI boom. Technologically, demand for 3nm and below GPU and memory chips has weakened, pressuring core players like TSMC, Samsung, and SK Hynix. Upstream EUV equipment and materials supply chains are affected, while midstream foundries see declining capacity utilization and downstream cloud and AI server firms such as Microsoft, NVIDIA, and Amazon face valuation reassessments. Policy-wise, intensified U.S. export controls on China Taiwan/ Taiwan, China are increasing supply chain fragmentation and operational costs. In market dynamics, despite optimistic CEO statements from NVIDIA, investor confidence in AI ROI is waning, prompting some firms to scale back capital expenditure. Over the next 12–24 months, the industry will enter a 'technology validation phase,' with extended AI investment cycles and capital structure optimization becoming critical. Without significant technological breakthroughs, continued market adjustment is expected.