New York, July 20, 2026 — A sharp rebound in semiconductor stocks on Monday was driven by a concentrated group of five leading chipmakers, which accounted for nearly all of the early gains in the iShares Semiconductor ETF (SOXX) and the Vanguard Information Technology ETF (VGT).
The rally marks a recovery from a steep decline the previous week, when the PHLX Semiconductor Index closed more than 20% below its late-June peak, though it remains up 65% for the year. The bounce was fueled by strong performance from Micron Technology (MU), Advanced Micro Devices (AMD), Nvidia (NVDA), Intel (INTC), and Broadcom (AVGO).
Data from early trading showed that these five stocks contributed 49% of SOXX's 2.1% rise and an outsized 94% of VGT's 0.8% gain. The group makes up 37.3% of SOXX and 31.0% of VGT by weight. Nvidia alone, with an 8.5% weighting in SOXX and 16.1% in VGT, contributed 0.24 percentage point to VGT's advance. Micron rose 4.1%, adding 0.32 percentage point to SOXX. The calculations are based on the most recent listed weights and are estimates, as VGT notes its holdings may not reflect current portfolio data.
The rebound was tempered by weakness in other mega-cap tech names. Apple (AAPL) fell 1.4% and Microsoft (MSFT) slipped 0.8%, together dragging VGT down by about 0.27 percentage point, given their combined 22.6% weight in the fund.
Market participants remain focused on earnings, which are expected to be robust. LSEG projects a 133% increase in chip and equipment profits for the second quarter, with the sector potentially accounting for 44% of total S&P 500 profit growth. However, solid earnings have not guaranteed stock price support; Taiwan Semiconductor Manufacturing (TSM) declined last week despite a 77% surge in quarterly profit.
“The daily moves for companies this big are just shocking,” said Rick Meckler, partner at Cherry Lane Investments. He noted that a poor outlook could quickly alter the earnings landscape. Barclays strategists, led by Ajay Rajadhyaksha, have shifted to a neutral stance on risk assets, advising investors to “wait for this new round of AI jitters to fade,” citing crowded positions and uncertainty around AI investment returns.
Intel and Texas Instruments (TXN) are scheduled to report earnings this week, while Nvidia will announce results in late August. Investors will scrutinize company guidance to determine if earnings growth can sustain the sector's projected gains for the rest of 2026. Risks to the outlook include disappointing forecasts, deleveraging, or a decline in memory prices.
