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The market capitalization of global chip manufacturers has fallen by more than $500 billion, triggered by the AI bubble and high valuations leading to a selling spree.
On November 5, Jin10 reported that the market capitalization of global chip manufacturers has sharply declined, as investors' concerns over the high valuations of tech stocks deepen. The selling wave led to a combined evaporation of about $500 billion in market capitalization for the Philadelphia Semiconductor Index on Tuesday and the index tracking Asian chip stocks on Wednesday. This big dump highlights that the rise of semiconductor stocks driven by the AI boom has been excessively overdrawn. Since the low point in April, as investors bet on a surge in AI computing demand, the market capitalization of chip manufacturers has increased by several trillion dollars. However, the current pullback reflects the market's growing concerns about the industry’s earnings prospects and excessively high valuations, especially against the backdrop of interest rates potentially being 'higher for longer.' Chris Weston, the research director at Pepperstone Group, stated: 'The entire market is a 'sea of blood,' presenting a gloomy and dull risk landscape. We must keep an open mind and acknowledge that this adjustment may further expand. Currently, there is almost no reason to buy.'
