Semiconductor ETF Stages Sharp Rebound as Chip Supply Fears Ease and AI Spending Forecasts Swell
Published on 08/05/2026 at 05:42 | Redaktion boerse-global.de
The VanEck Semiconductor UCITS ETF has snapped out of its summer slump with a forceful one-day surge, closing at EUR 94.82 on Tuesday after gaining 6.54 percent. The move extends a seven-day winning streak that has now lifted the fund by roughly 16 percent, as investors rotate back into chip stocks on a combination of reassuring supply-chain news and blockbuster capital expenditure projections from Wall Street.
TSMC's All-Clear Removes a Key Overhang
A major catalyst for the rebound came from Taiwan Semiconductor Manufacturing Company, which confirmed in early August that its JASM facility in Japan's Kumamoto region emerged unscathed from a severe earthquake on July 28. The company verified that both buildings and equipment remain intact, with production continuing on schedule. That reassurance carried particular weight given TSMC's roughly 9.5 percent weighting in the ETF and its pivotal role as a manufacturer of advanced AI chips.
The all-clear arrived alongside a batch of solid earnings from portfolio holdings. Tower Semiconductor posted record second-quarter revenue of USD 460 million on August 4, comfortably beating analyst expectations, and guided to USD 520 million in sales for the current quarter.
Wall Street's Billion-Dollar AI Bet
The broader rally, however, has been fueled less by individual earnings and more by a sweeping reassessment of how much the hyperscalers will spend on artificial intelligence infrastructure. Bank of America now projects the major cloud providers will scale capital expenditures to more than USD 1.2 trillion within the next twelve months, up from roughly USD 700 billion. For the current year, the bank estimates spending of USD 859 billion — a 79 percent increase year over year — while Morgan Stanley arrives at a similar figure of USD 800 billion for 2026 and also sees USD 1.2 trillion by 2027.
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These projections rest on contractual commitments already in hand: cloud providers are sitting on customer obligations of USD 2.3 trillion, according to Bank of America. That visibility has prompted the bank to issue nine buy ratings with at least 30 percent upside potential, spanning Marvell, Nvidia, Broadcom, AMD, and Micron.
The numbers echo guidance from the tech giants themselves. Microsoft, Amazon, Alphabet, and Meta have confirmed combined investments of roughly USD 725 billion for 2026, much of it destined for data centers and specialized AI accelerators. Industry leaders have added their own bullish color: Nvidia CEO Jensen Huang has pegged the potential semiconductor market from "agentic AI" at up to USD 7.9 trillion, while SK Hynix unveiled the first standard specification for High Bandwidth Flash at the FMS-2026 conference in Santa Clara on August 4. MediaTek, for its part, confirmed it will use advanced packaging from both TSMC and Intel for upcoming AI ASIC projects.
A Brutal July Preceded the Turnaround
Tuesday's surge marks a sharp reversal from one of the weakest months in recent sector history. Chip stocks worldwide shed more than USD 3 trillion in market value during July, dragged down by concerns over stretched valuations and the possibility of an AI bubble. The VanEck fund itself lost 5.84 percent on a monthly basis before the recovery took hold.
Notably, the sell-off did not trigger a flight from the sector. The comparable iShares Semiconductor ETF posted net inflows of USD 6.92 billion in July — its best month on record — even as its price dropped 22.1 percent, the worst monthly showing since December 2002. Investors, it appears, treated the weakness as a buying opportunity rather than a reason to exit.
Single Stocks Provide the Spark
Individual names added fuel to Tuesday's rally. Micron jumped 8 percent after Bank of America reaffirmed its buy rating and raised its price target to USD 1,550, citing intact pricing power in memory chips. Arm climbed more than 11 percent to USD 266.63 following a second consecutive quarter of license revenue growth above 100 percent year over year in its data center business. ON Semiconductor also advanced, with second-quarter revenue up 9.2 percent and adjusted earnings per share rising nearly 40 percent, supported by strong AI data center demand.
The renewed enthusiasm has even spawned new product offerings: REX Shares launched two leveraged certificates on the US-listed VanEck Semiconductor ETF on Tuesday, one with triple long and one with triple short exposure — a sign of how actively traders are now positioning for short-term swings in the sector.
Room to Run, But Volatility Persists
Despite the sharp gains, technical indicators suggest the fund is not overheated. The relative strength index sits at 51.1, squarely in neutral territory. Still, the ETF remains nearly 15 percent below its 52-week high of EUR 111.18, reached on June 30. On a year-to-date basis, the fund is up 78 percent, while its 12-month gain stands at 130.31 percent — comfortably outpacing broader technology indices.
Investors should brace for continued turbulence, however. The annualized 30-day volatility of roughly 61 percent underscores that double-digit swings in either direction remain a live possibility. Whether the rally extends beyond this initial burst will likely hinge on whether the hyperscalers' ambitious spending plans translate into actual chip orders — and whether the sector can sustain its momentum toward reclaiming those earlier highs.
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