Newberry residents tracking market trends may note that semiconductor chipmakers are currently leading the US stock market, overshadowing traditional Big Tech companies. This trend was particularly evident on Thursday, August 27, 2026, when Nvidia shares climbed nearly 9% following strong earnings that showed doubled sales from the previous year and optimistic growth forecasts. This performance boosted other chipmaker stocks and contributed to a 1.57% rise in the tech-heavy Nasdaq and a 0.72% increase in the S&P 500.
The surge in chipmaker stocks, including companies like Intel, is attributed to their crucial role in the artificial intelligence infrastructure supply chain. For example, Micron Technology shares have increased by 220% this year, surpassing $1 trillion in market value in May. Marvell Technology is up 185%, and Intel has seen a 150% rise. These gains highlight the significant investment in AI infrastructure, with chip stocks accounting for 37% of the S&P 500’s market value increase this year, which totals approximately $7.6 trillion. The semiconductor industry now represents nearly a third of the S&P 500’s market value, according to Stifel, an investment bank. Chip and tech hardware stocks also make up almost 45% of the Nasdaq 100.
Despite the strong performance of chipmakers, Big Tech stocks have shown more volatility. Microsoft shares, for instance, are up only 4% this year and have not reached a new record high in 10 months. Alphabet and Amazon shares have risen about 8% and 11% respectively this year, but both are down from recent peaks. Apple is up about 16% this year, still lagging behind many chipmakers. Even Nvidia, a chipmaker itself, has seen a more modest 22% increase this year compared to other chip companies. An exchange-traded fund tracking semiconductor chip stocks is up 70% this year, while an ETF for the Magnificent Seven group of Big Tech stocks (Alphabet, Amazon, Apple, Microsoft, Meta, Nvidia, and Tesla) is up just 4%.
The market’s heavy reliance on chip stocks introduces potential risks. Analysts suggest that if semiconductor firms begin to struggle, the broader stock market could face significant challenges. The current enthusiasm for AI-related trades, particularly in semiconductors, has drawn comparisons to the late 1990s market. While some strategists remain optimistic, they also acknowledge the possibility of a shift in investor sentiment, especially if Big Tech’s spending on AI infrastructure slows, which could impact future chipmaker profits. Instances like Broadcom’s stock drop in early June, following slightly missed chip revenue forecasts, illustrate the market’s sensitivity to expectations in the semiconductor sector.
