Micron and SanDisk shares rebounded in the early premarket trading on Monday after a bruising semiconductor sell-off forced investors to reassess one of the most crowded parts of the artificial intelligence trade.

At 5:45 am ET, Micron (NASDAQ: MU) was up more than 3%, while SanDisk (NASDAQ: SNDK) had gained about 2.5%, according to market data, as investors attempted to buy the dip following last week’s sharp sell-off.

The reversal captures the debate confronting memory investors: did last week’s rout create an attractive entry point, or is the market beginning to anticipate the next downturn in a notoriously cyclical industry?

Micron, SanDisk stock: A brutal sell-off invited dip buyers

The rebound followed a punishing week for AI hardware as the Philadelphia Semiconductor Index dropped 1.6% on Friday and entered a bear market after falling more than 20% from its June peak.

Micron ended the week roughly 30% below its June record, while SanDisk had retreated more than 28% from its June 25 high.

SanDisk stock rose by more than 600% in 2026, underscoring how far expectations and valuations had run before the correction.

That reset encouraged traders to revisit companies still benefiting from constrained supply and rising prices.

JPMorgan cross-asset strategist Fabio Bassi described the chip decline as a temporary “wobble”, rather than the end of the AI rally, in comments reported by The Wall Street Journal.

Bassi said memory stocks had become highly concentrated positions, allowing small changes in sentiment to produce unusually large moves.

Demand for the computing capacity required by AI, however, remained strong.

That helps explain why Monday’s buyers emerged quickly, even though the broader valuation and spending concerns behind Friday’s rout had not disappeared.

Shortages keep the bullish case alive

The fundamental argument has not disappeared.

KeyBanc analyst John Vinh said “memory shortages remain persistent” after supply-chain checks in Asia. Vinh expects tight conditions through 2027.

KeyBanc forecasts DRAM prices will rise 15% to 20% sequentially in the third quarter and another 15% in the fourth. NAND prices could jump 30% to 40% this quarter, followed by another 15% increase.

Micron is heavily exposed to DRAM and high-bandwidth memory used alongside AI accelerators.

SanDisk is centred on NAND flash and enterprise solid-state drives, which store and retrieve the datasets used in AI workloads.

Evercore ISI analyst Amit Daryanani told clients that SanDisk’s long-term customer agreements were creating a “new memory paradigm.”

Those contracts improve visibility into revenue, earnings and cash flow while clean-room capacity remains constrained.

The boom is creating its own risk

The same shortage supporting prices is encouraging enormous investment.

Samsung and SK Hynix have outlined hundreds of billions of dollars in new manufacturing projects, while Micron recently raised its planned United States investment to more than $250 billion through 2035.

That spending will take years to affect output, but it revives memories of previous cycles when shortages triggered overbuilding and falling prices.

China’s ChangXin Memory Technologies is another concern.

Morgan Stanley estimates China could provide about 30% of net DRAM wafer additions through 2028.

Higher memory prices may also become self-defeating.

Costlier DRAM, HBM and NAND raise the expense of AI infrastructure, increasing pressure on hyperscalers already being asked to prove returns on huge capital budgets.

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As the second-quarter earnings season of 2026 approaches its most critical stretch, the global equity market finds itself at a pivotal crossroads.

For over two years, a relentless, AI-driven bull run has propelled mega-cap technology valuations to historically elevated levels.

However, the narrative on trading desks has undergone a fundamental shift. The era of rewarding companies simply for uttering the words “artificial intelligence” is officially over.

As Alphabet, Microsoft, Meta, Amazon, and Apple prepare to open their books between July 22^nd  and July 30^th, Wall Street is demanding concrete evidence of monetization.

Investors are no longer grading on a curve; they want to see the receipts.

Big tech earnings ahead: the $725 billion arms race

The defining metric of this entire reporting cycle will undoubtedly be capital expenditure (capex).

The sheer scale of infrastructure investments being deployed by the four major US hyperscalers – Amazon, Microsoft, Alphabet, and Meta – has reached eye-watering proportions.

According to updated consensus data, their combined capex guidance now sits at an unprecedented $725 billion for the current year, representing a staggering 77% increase from 2025.

2026 projected capex commitments:

Amazon: ~$200 billion

Microsoft: ~$190 billion

Alphabet: $180 billion – $190 billion

Meta Platforms: $125 billion – $145 billion

This staggering allocation of capital into graphics processing units (GPUs), power grids, and massive data center footprints has triggered intense anxiety among institutional allocators.

While this structural build-out serves as a massive secular tailwind for hardware providers like Nvidia (which won’t report its data center metrics until August 26), it places immense pressure on the software and cloud giants to prove this capital is yielding high-margin returns.

A guidance cut this week would signal weak underlying enterprise demand – while an unbacked increase in spending without a corresponding bump in revenue could spark a sharp margin-driven sell-off.

The reporting calendar: key dates and battlegrounds

The heavy lifting begins next week, with the market tightly focused on three specific reporting windows:

• July 22, 2026 (Alphabet): Google’s parent company kicks off the gauntlet alongside Tesla. Alphabet’s Q1 results saw Google Cloud revenue expand by an astonishing 63% year-on-year to hit $20 billion, boasting a record 32.9% operating margin. Wall Street is looking for Q2 revenue to hit roughly $116.8 billion. The core focus will be whether Google Cloud can sustain its 63% growth crown or if aggressive new market entrants have begun eating into its enterprise pipeline.
• July 29, 2026 (Microsoft & Meta): Microsoft will present its fiscal fourth-quarter results, where any print for Azure growth below 35% will likely be treated as a severe deceleration. Simultaneously, Meta will need to prove that its $125 billion+ capex is continuing to optimize its ad-targeting engine and drive top-line growth to offset the massive cash burn of its infrastructure layer.
• July 30, 2026 (Amazon & Apple): Amazon is expected to print revenue near $196 billion, with the market hyper-focused on AWS margin expansion. Apple will report its fiscal third-quarter numbers with an estimated revenue of $108.9 billion. Apple presents a fascinating contrarian play; by leveraging an installed base of over 2.3 billion active devices to deploy “Apple Intelligence,” it is executing a capital-light AI strategy that insulates its margins from the data center spending war engulfing its peers.

Cloud growth: The ultimate litmus test

Because cloud infrastructure is where enterprise AI demand materializes first, the sequential and year-over-year growth rates of Azure, AWS, and Google Cloud will serve as the market’s ultimate truth mechanism.

Investors are highly attuned to the risk of a “margin squeeze” – a scenario in which heavy depreciation costs from newly built data centers kick in before corporate clients scale up their paid software seats and API usage.

A note of caution was already introduced to the broader tech sector following IBM’s earnings miss on July 14^th, which triggered a sharp one-day decline.

While analysts isolated that specific event to hardware supply-chain timing rather than systemic weakness in macro AI demand, it illustrated just how fragile investor sentiment has become.

With valuations priced for perfection, the upcoming multi-day stretch will decide whether Big Tech’s massive architectural bets can sustain the next leg of the macroeconomic expansion, or if the market is due for a harsh reality check on the actual velocity of AI monetization.

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Wall Street’s biggest banks are proving that even geopolitical uncertainty and volatile markets can be highly profitable when trading desks stay busy and artificial intelligence fuels an unprecedented wave of capital raising.

The six largest US banks generated a combined $55 billion in second-quarter profits, comfortably exceeding analysts’ expectations as market volatility, record AI-related fundraising and a resurgence in investment banking produced one of the strongest quarters for the financial industry in years.

Even after excluding JPMorgan Chase’s one-off Visa and equity-related gains, the six banks still generated roughly $50.4 billion in profit during the quarter.

Every one of the six lenders exceeded Wall Street estimates on both earnings and revenue, driven largely by record trading activity and a sharp rebound in investment banking.

Trading desks deliver blockbuster quarter

Trading operations once again emerged as the biggest earnings driver as geopolitical tensions and energy market volatility kept investors actively repositioning portfolios.

Financial markets were shaken during the quarter by the conflict in the Middle East and disruptions to shipping through the Strait of Hormuz, while a spike in oil prices reignited inflation concerns and prompted investors to reassess expectations for Federal Reserve interest-rate cuts.

Those rapid swings translated into exceptional trading volumes across equities, currencies, commodities and fixed income.

Goldman Sachs led the industry with a record $7.42 billion in equities trading revenue, a 72% increase from a year earlier.

Fixed-income trading contributed another $4.59 billion, up 32%.

JPMorgan Chase generated $6 billion in equities revenue, an 86% jump from last year, while fixed-income trading remained steady at $6.1 billion, bringing total markets revenue to $12.1 billion.

Morgan Stanley also reported record equity trading revenue of $6.3 billion, up 69%, alongside $2.5 billion from fixed income.

Bank of America posted record equities trading revenue of $3.6 billion, up 70%, while fixed-income, currencies and commodities (FICC) revenue rose 9% to $3.5 billion.

Citigroup’s equities trading business climbed 45% to a record $2.3 billion, while fixed-income revenue increased 7% to $4.7 billion.

Although its trading franchise remains considerably smaller, Wells Fargo also benefited from heightened activity.

Markets revenue within its Corporate and Investment Banking division rose 24% to $2.21 billion, with equities trading alone increasing 64%.

Dealmaking powers investment banking recovery

The recovery in investment banking proved equally significant, with AI emerging as one of the biggest catalysts for capital markets activity.

Investment banking fees surged across all six banks as mergers and acquisitions, equity offerings and debt issuance accelerated during the quarter.

Goldman Sachs generated $3.4 billion in investment banking fees, up 55% year over year, supported by strong advisory work and record debt underwriting.

JPMorgan Chase reported $3.3 billion in fees, up 30% and its strongest investment banking quarter since 2021.

Morgan Stanley posted the fastest growth among its peers, with investment banking revenue jumping 58% to $2.44 billion.

Bank of America, Citigroup and Wells Fargo also recorded healthy increases in advisory and underwriting income.

According to Dealogic, global investment banking revenue climbed 24% during the first half of 2026 to $61.4 billion, driven by mega mergers, a vibrant IPO market and elevated trading volatility.

Among the quarter’s most lucrative transactions was SpaceX’s record-breaking $86 billion initial public offering in June, the largest IPO in US history.

The listing alone generated roughly $500 million in investment banking fees across participating firms, with Goldman Sachs serving as lead-left underwriter while JPMorgan, Bank of America, Citigroup and Wells Fargo participated as co-underwriters and advisers.

AI spending is creating a new financing cycle

Executives across Wall Street argued that artificial intelligence is creating opportunities extending far beyond technology companies themselves.

Banks are financing data centres, underwriting debt and equity offerings, advising on acquisitions and facilitating the enormous capital flows required to build AI infrastructure worldwide.

For example, Wells Fargo advised on NextEra Energy’s $67 billion acquisition of Dominion Energy and Apollo’s $35 billion financing package for AI company Anthropic.

Goldman Sachs CEO David Solomon described the investment wave as creating “a ripple effect” throughout the US economy by generating financing and trading opportunities across public and private markets.

“We are in the middle of an AI capex super cycle where there are demands on financing in every single financing instrument, in every region of the world and across every single industry,” Goldman Chief Financial Officer Denis Coleman said.

Wells Fargo banking analyst Mike Mayo said the AI investment cycle “reached a tipping point” during the second quarter, identifying Goldman Sachs, JPMorgan Chase and Morgan Stanley as the biggest beneficiaries.

Following the strong earnings reports, Mayo raised his price targets on both Goldman Sachs and JPMorgan.

Consumer lending remains resilient

While capital markets dominated the headlines, consumer banking also continued to support earnings despite persistent inflation pressures.

Banks reported relatively low delinquency rates, while expectations that interest rates will remain elevated for longer continued to support lending profitability.

Bank of America added one million new credit card accounts during the quarter as customers spent $266 billion on debit and credit cards, up 9% from a year earlier.

Wells Fargo reported a 33% increase in auto loan revenue, helped by higher balances and stronger loan originations.

Even as many households continued to face rising costs for essentials such as fuel and groceries, banks continued to benefit from healthy consumer spending and resilient credit quality.

Banks are also adopting AI internally

The AI boom is not only generating advisory and financing fees but is also reshaping banks’ own operations.

Lenders are increasingly deploying artificial intelligence to improve productivity, automate workflows and manage costs.

Bank of America disclosed that it now has more than 300 approved artificial intelligence and machine learning use cases across its business.

These include 114 live generative AI applications, with 34 already deployed at scale to improve workflow efficiency and frontline productivity.

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Volvo Group reported stronger second-quarter financial results, driven by higher profitability and robust truck order intake in North America despite continued external cost pressures.

Net sales in the second quarter of 2026 increased 3% year over year to SEK 126.3 billion, compared with SEK 122.9 billion in the same period last year.

Organic sales growth stood at 7%.

The company said adjusted operating income excluded negative effects totaling SEK 1.305 billion during the second quarter of 2026.

North America drives truck order growth

Volvo reported a 35% increase in second-quarter operating profit and said truck order intake in North America more than doubled after several years of subdued demand.

The company, one of the world’s largest manufacturers of trucks, buses, and construction equipment, said reduced spending in areas such as research and development more than offset the impact of US tariffs and higher freight and material costs.

Overall truck order intake across the group rose 33% during the quarter.

Order intake in North America surged 122%, while Europe remained the company’s largest market.

Chief Executive Officer Martin Lundstedt said, “(Truck) demand in Europe and South America continued to grow gradually, while it was exceptionally strong in North America.”

Shares in Volvo were roughly unchanged in mid-morning trading.

European market outlook revised higher

Volvo said the recovery in North American orders follows several years of weak market conditions in the region, where slowing haulage activity had resulted in declining freight rates and excess truck capacity.

However, the company noted that stronger order activity has not yet translated into higher retail sales.

“Truck industry production levels, deliveries, and retail sales are expected to increase in the second half of the year,” the company said regarding the North American market.

Volvo also raised its outlook for the European truck market, increasing its forecast for new truck registrations this year to 315,000 from the 310,000 projected in April.

The company maintained its North American retail sales forecast of 265,000 trucks for the year.

The company remains cautious about external risks

Second-quarter operating profit rose to SEK 13.5 billion from SEK 9.96 billion a year ago.

The result was broadly in line with the analyst forecast of SEK 13.6 billion in an LSEG poll.

In addition to trucks, Volvo manufactures buses, excavators, wheel loaders, haulers, and marine engines, while also developing self-driving truck technology.

CEO Martin Lundstedt said the company would continue to monitor global developments closely.

“This improvement was broad-based with vehicle sales growing 6% and service sales 7% organically,” he said.

He added, “The second quarter of 2026 demonstrates the strength and adaptability of the Volvo Group.”

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US stock futures were mixed on Thursday as investors paused after a two-day advance and weighed whether strong earnings can keep the rally moving while semiconductor shares remain under pressure.

Futures tied to the Dow Jones Industrial Average surged 131 points, or 0.08%, reversing an earlier gain. S&P 500 futures edged 0.1% lower, while Nasdaq 100 contracts fell 0.45%.

Retail sales, jobless claims and another round of results will test whether easing inflation can coexist with resilient growth and elevated equity valuations across Wall Street this morning.

5 things to know before Wall Street opens

1. TSMC’s record quarter fails to impress

TSMC posted net profit of NT$706.6 billion, up 77% from a year earlier, as revenue climbed 36% to NT$1.27 trillion.

It also lifted its 2026 revenue-growth outlook to slightly above 40% and raised planned capital spending to between $60 billion and $64 billion.

The shares fell before the bell. Investors are focusing on the cost of sustaining AI growth, including TSMC’s additional $100 billion commitment to US manufacturing, rather than simply rewarding the earnings beat.

2. The semiconductor retreat remains broad

Western Digital and Seagate fell more than 3% in premarket trading, extending a pullback across memory and hardware stocks.

The Philadelphia semiconductor index ended Wednesday about 16% below its June 22 record.

The weakness suggests capital is rotating towards megacap platforms and financial shares. It also shows why strong chip results may struggle to satisfy a market priced for perfect execution.

3. Retail sales and jobless claims take centre stage

June retail sales and weekly unemployment claims are due at 8:30 am in Washington.

Retail spending rose 0.9% in May, so Thursday’s report will show whether consumers retained momentum as borrowing costs stayed elevated.

The releases follow a 0.3% decline in June producer prices and softer consumer inflation.

Markets have sharply reduced expectations for an imminent Fed increase, but stronger demand data could revive concerns that the economy remains too hot.

4. UnitedHealth and Netflix carry different tests

UnitedHealth reports before the bell, with investors looking for signs that medical costs and reimbursement pressures are stabilising.

Netflix reports after the close, putting engagement, advertising growth and margins in focus.

UBS investment chief Mark Haefele expects profits to remain the main driver for equities despite geopolitical setbacks.

The chip reaction shows solid results may not be enough without confident guidance.

5. Higher fuel costs hit airline sentiment

United Airlines slipped after warning that 2026 fuel expense could be almost $6 billion higher than expected at the start of the year.

The carrier still beat quarterly estimates and raised its adjusted earnings outlook, highlighting resilient demand.

Oil remains a key market wildcard. A sustained rise could squeeze transport margins, revive inflation pressure and limit the benefit Wall Street has drawn from softer price data.

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ASML Holding raised its financial guidance for 2026 on Wednesday after reporting stronger-than-expected second-quarter earnings and announcing plans to increase capacity.

The results showed that robust demand for artificial intelligence chips continues to fuel investment across the semiconductor industry.

The Dutch company, the world’s largest supplier of semiconductor manufacturing equipment, now expects full-year 2026 net revenue of between €43 billion and €45 billion, representing a 16% increase at the midpoint from its previous forecast range of €36 billion to €40 billion.

The upbeat guidance sent ASML shares more than 5% higher in Amsterdam, while its US-listed shares climbed about 3.5% in premarket trading.

The company also issued stronger-than-expected guidance for the current quarter, forecasting third-quarter revenue of €11.5 billion, well above analysts’ consensus estimate of €10.37 billion.

It expects a gross margin of 56%, compared with market expectations of 52.1%.

Earnings beat estimates

Revenue for the three months ended June 30 rose to €9.33 billion ($10.9 billion), comfortably ahead of analysts’ estimates of €8.8 billion compiled by LSEG.

Net income came in at €2.92 billion, also exceeding expectations of €2.62 billion.

The results were closely watched after recent sell-offs across technology stocks amid concerns that the AI investment cycle could be losing momentum.

Instead, ASML reported what Chief Executive Christophe Fouquet described as “extremely strong” order intake, underpinned by continued spending on AI infrastructure.

“Ongoing AI-related investments and continued progress in AI technologies are driving demand for advanced Logic and Memory chips, further strengthening the semiconductor industry’s growth outlook,” Fouquet said in a statement.

“Our customers, in turn, continue to accelerate their capacity expansion plans, providing ASML with increased visibility into longer-term demand.”

Chipmakers continue expanding capacity

ASML remains the world’s sole manufacturer of extreme ultraviolet (EUV) lithography systems, which are essential for producing cutting-edge semiconductors used in AI processors.

Customers, including Taiwan Semiconductor Manufacturing Co. (TSMC), Samsung Electronics, SK Hynix, and Micron Technology, are investing heavily to expand production capacity as demand for AI chips continues to rise.

The company said it plans to increase production capacity for both its flagship EUV systems and deep ultraviolet (DUV) tools by about 30% in each of the next two years.

While EUV machines are used to manufacture the most advanced chips, DUV systems continue to see strong demand for mature-node production, including in China.

Separately, Fouquet said Intel will use ASML’s latest High-NA EUV system to manufacture some of its most advanced Panther Lake processors, marking the first commercial deployment of the technology.

Analysts remain optimistic

Analysts said the earnings underscored that AI-driven investment remains firmly intact.

“The biggest surprise came from customers upgrading and servicing equipment already on factory floors, a sign that chipmakers are pushing existing capacity while preparing for the next wave of investment,” said Matt Britzman, senior equity analyst at Hargreaves Lansdown.

“But this is more than a short-term scramble. AI demand is pulling investment forward across both advanced computing and memory chips, giving ASML clearer sight of customer demand well beyond this year.”

Britzman added that the debate has now shifted from demand to manufacturing capacity.

“The story has now shifted from whether demand will arrive to whether ASML can expand production fast enough to meet it. Management is responding with ambitious capacity plans, directly addressing one of the main concerns that has been rumbling in the background.”

“That supports our view that ASML remains one of the clearest ways to gain exposure to the AI infrastructure build-out, thanks to technology that the world’s leading chipmakers simply cannot replace. ASML now needs to convert a powerful order pipeline into system deliveries, revenue, and profit – scaling production without losing control of costs.”

Bank of America reiterated its Buy rating and €2,022 price target on the stock following the results, Investing.com reported, a 14% upside to Wednesday’s levels.

According to the brokerage, ASML’s updated guidance implies fourth-quarter revenue of €14.41 billion, significantly above the consensus estimate of €11.62 billion, with gross margins also expected to exceed market forecasts.

ASML shares have gained about 66% in Amsterdam this year and more than 52% in US trading, reflecting growing investor confidence that the company remains one of the biggest beneficiaries of the global AI infrastructure buildout.

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US stock futures were mixed on Tuesday as investors prepared for inflation data, major bank earnings and Federal Reserve commentary, while another surge in oil revived fears that the Middle East conflict could prolong the fight against rising prices.

Dow Jones futures fell 141 points, or 0.3%, while S&P 500 futures were little changed. Nasdaq-100 futures outperformed, rising 0.44%.

Wall Street is balancing the prospect of stronger corporate profits against the risk that higher energy costs trigger another round of monetary tightening.

5 things to know before Wall Street opens

1. June inflation may already look dated

The consumer-price index is due at 8:30 am in Washington.

Economists expect annual inflation to ease to about 3.8% from 4.2% in May, helped by lower petrol prices, while core inflation is forecast to remain near 2.9%.

That may offer limited comfort because crude has climbed sharply since the June measurement period.

Investors could focus more on the latest energy shock than on a softer, backward-looking headline reading.

2. Big banks open the earnings season

JPMorgan, Bank of America, Goldman Sachs, Wells Fargo and Citigroup are due to report before the opening bell.

Investors will focus on trading revenue, investment-banking fees, loan growth and signs of stress among consumers and companies.

The results are an early test of whether profits can support the S&P 500’s roughly 10% advance this year.

Strong capital-markets activity could extend the rally, while higher credit provisions would raise questions about the economy’s resilience.

3. Oil returns as Wall Street’s main macro risk

Brent crude climbed above $85 a barrel, its highest level in about a month, after a third consecutive night of US strikes on Iran.

President Donald Trump also said Washington would restore its blockade of Iranian shipping and seek reimbursement equal to 20% of cargo moving through the Strait of Hormuz.

The risk of disrupted flows through a route carrying about a fifth of global oil supplies has pushed inflation back to the centre of the market debate.

4. Warsh faces a congressional test

Fed Chair Kevin Warsh will deliver the semi-annual monetary policy report to the House Financial Services Committee at 10 am.

Investors will watch whether he treats the oil shock as temporary or as a threat to inflation expectations.

Governor Christopher Waller added to the hawkish tone on Monday, arguing that persistently elevated inflation could require tighter policy in the near term.

5. Chip shares attempt a rebound

Nasdaq futures outperformed as semiconductor shares recovered in premarket trading following Monday’s sharp retreat.

The Nasdaq Composite lost 1.6% in the previous session as technology stocks bore the brunt of higher oil prices and rising Treasury yields.

The rebound offers some support to growth shares, but its durability may depend on the CPI reading, bond-market reaction and whether oil extends its advance.

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US chip stocks are extending losses on July 13 as Washington and Tehran lock horns in a dangerous new phase of open hostility.

Over the weekend and into Monday morning, the US Central Command (CENTCOM) launched heavy airstrikes targeting about 140 Iranian military installations, and Iran retaliated against regional US bases and declared the critical Strait of Hormuz closed.

And while a geopolitical crisis of this magnitude naturally triggers a broad Wall Street sell-off, it stands to prove uniquely catastrophic for semiconductor stocks.

Far from just an “oil shock” or general market panic, the US-Iran war is super bearish for the chip sector, threatening to choke the lifeblood out of the global technology sector.

Intel INTC, AMD and other chip stocks fell on Monday’s session. Intel declined by 4% while AMD and Broadcom fell by 2%.

Why US-Iran war is a major threat to chip stocks

When investors think of the Middle East, they think mostly of crude oil – but for chipmakers, the region holds an entirely different, irreplaceable prize: noble gases and critical minerals.

Qatar alone accounts for over one-third of the global supply of helium, an element indispensable to high-end semiconductor fabrication.

Pure helium is absolutely critical for heat management, ultra-precise temperature regulation during wafer processing, and the delicate photolithography steps required to print modern AI circuitry.

With the Ras Laffan industrial facilities previously suffering disruption and the Strait of Hormuz now entirely blocked by Iranian forces, the global supply chain for these specialized materials has ground to a halt.

Without viable structural alternatives for helium and bromine, top-tier foundries face immediate production throttling, directly harming revenue generation.

Why the downside is particularly pronounced in 2026

The re-ignition of this war couldn’t come at a worse time for a semiconductor sector aggressively pricing in an artificial intelligence (AI) boom.

Tech companies are spending hundreds of billions on AI data centers, leaving chip designers and manufacturers operating on ultra-tight timelines and vulnerable supply lines.

As the closure of the Strait forces massive maritime detours and sends jet fuel prices skyrocketing, air and sea freight surcharges are inflating exponentially.

Semiconductor manufacturing is a multi-step global relay race; raw materials, silicon ingots, and packaged chipsets cross oceans multiple times before final assembly.

Escalating regional warfare piles huge logistical costs onto a capital-intensive industry, squeezing corporate margins and forcing analysts to drastically cut earnings estimates for the world’s most valuable chip stocks.

What to expect from chip stocks moving forward?

The swift back-and-forth between Washington and Tehran has shattered any illusions of a brief, contained skirmish.

Instead, Wall Street is realizing that this conflict is beginning to mirror the grinding, multi-year reality of the Russia-Ukraine war – one that defies quick diplomatic or military resolution.

If this war drags into a prolonged war of attrition, the related supply chain bottlenecks threatening the semiconductor sector could harden into a permanent economic drag.

For a chip industry heavily exposed to cyclical downturns and priced for perfection on the back of the AI boom, an extended Middle Eastern conflict could derail earnings.

With no off-ramp in sight, chip stocks are bracing for a highly turbulent and deeply bearish second half of 2026.

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SpaceX stock (SPCX) fell for a second consecutive trading session on Monday, moving closer to the company’s $135 initial public offering price just days after joining the Nasdaq-100 index.

The stock declined more than 4% to trade around $139 as broader US equity markets also came under pressure.

The S&P 500 fell to session lows after President Donald Trump announced he was reinstating what he described as a blockade on Iranian shipping through the Strait of Hormuz.

The broad-market index lost 0.4%, while the Nasdaq Composite fell 1%. The Dow Jones Industrial Average traded 56 points, or 0.1%, lower.

Bernstein reiterates bullish outlook

Despite the stock’s decline, Bernstein analyst Douglas Harned reiterated a Buy rating on SpaceX with a price target of $239, implying upside of more than 70% from current levels.

According to Harned, SpaceX’s leadership in reusable rockets and launch services remains intact even after China successfully landed a Long March 10B rocket booster.

Harned said China’s successful landing occurred about six months earlier than he had expected and noted that the country is rapidly expanding its space ambitions.

He said China plans to deploy more than 200,000 low-Earth orbit satellites and is also pursuing a research station on the Moon.

Harned also said the Long March 10 can only reuse its first-stage booster, while SpaceX’s Starship is designed to be fully reusable.

If successful, he said, Starship could further reduce launch costs and enable the company to increase launch frequency.

Several Wall Street firms have outlined ambitious long-term scenarios for SpaceX, driven largely by expectations for Starlink, its reusable launch business, and potential opportunities in AI infrastructure.

Among the more bullish forecasts, Raymond James has one of the Street’s highest published price targets at $800 per share.

Meanwhile, Citigroup has outlined a bull-case scenario that values SpaceX at roughly $12 trillion.

Stock gives back part of early gains

Monday’s decline follows a strong start to SpaceX’s life as a publicly traded company.

The stock surged more than 30% during its first several trading sessions before reversing course.

The pullback has brought the shares closer to their $135 IPO price after the company made its Nasdaq debut on June 12.

The stock had already fallen below its $150 debut trading price following its initial sessions in the public market.

The company’s combination of high valuation expectations, ambitious long-term growth projections, and limited trading history has left the shares particularly sensitive to changes in investor sentiment.

Nasdaq-100 inclusion draws passive investment

SpaceX’s recent addition to the Nasdaq-100 prompted a new wave of passive investment, as funds tracking the benchmark adjusted their portfolios to reflect the updated index composition.

The inclusion came after the exchange revised its rules governing newly listed companies, allowing the space and artificial intelligence company to join the benchmark within a month of going public.

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Planet Labs stock continued its strong downward trend last week, reaching its lowest level since March 19. PL has dropped by 50% from its highest point this year, with the market capitalization falling from over $18.40 billion in May to the current $9.28 billion, and technicals suggest that it has more downside to go.

The ongoing PL stock retreat has coincided with that of other companies in the space industry. SpaceX stock has plunged to a record low, while Rocket Lab fell by 47% from its highest point this year. The Procure Space ETF (UFO) dropped from the year-to-date high of $68.3 to $46.

Planet Labs stock dropped despite revenue growth 

PL stock has plunged in the past few weeks, even after the company published strong financial results. Its recent results showed that its revenue and backlog continued rising in the last quarter.

Planet Labs revenue jumped by 42% in the first quarter to $94.2 million, with the percentage of recurring annual contract value (ACV) soaring to 99%.

The company’s gross margin softened a bit to 54%, with its net loss soaring to $138.9 million from the $12.6 million it lost a year earlier. This loss jumped because of a $106 million revaluation loss from a change in fair value of warrant liabilities related to stock appreciation.

Planet Labs expects the company’s growth will continue in the foreseeable future, helped by the rising demand from government agencies and corporations. The average estimate among analysts is that its revenue jumped by 42% in the second quarter to $104 million, followed by 40% in the second quarter. 

Planet Labs annual revenue is expected to continue rising by over 40% to $436 million, followed by $570 million next year. This growth will likely be because of the Pelican-11 satellite, which is designed to validate new technologies and capabilities in a bid to boost the quality of images.

Most notably, analysts expect the company will become profitable in the coming years. The average estimate is that the company will breakeven in terms of EPS as soon as next year.

Planet Labs stock has dropped because of the rising fears of dilution after the company entered an equity distribution plan to sell up to $1.5 billion of its Class A common stock from time to time. This likely explains why the company has a short interest of 12.4%.

PL stock technical analysis 

Planet Labs stock chart | Source: TradingView 

The daily chart shows that the Planet Labs stock has been in a freefall in the past few weeks, moving from a high of $51.60 in May to the current $26. 

It is attempting to drop below the key support level of $26.25, a move that will invalidate the forming of the double-bottom pattern.

It is attempting to move below the 50-day and 100-day Exponential Moving Averages (EMA), which are about to cross each other, forming a mini death cross.

The stock will likely continue falling, potentially to the key support level at $20, down by 23% from the current level. It will likely bounce back later this year as investors rotate back to space companies.

READ MORE: Wedbush makes a strong case for buying the dip in Planet Labs stock

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