Why Chip ETFs May Be Poised for a Comeback

Chip-focused ETFs may be set up for a rebound after one of the sharpest selloffs on record, according to Morgan Stanley strategist Michael Wilson, cited by Bloomberg via Yahoo Finance. The semiconductor sector lagged in July: the VanEck Semiconductor ETF (SMH) fell nearly 17% for the month, on track for its worst monthly performance since the 2008 financial crisis, as investors reassessed AI valuation and the impact of higher interest rates. Wall Street’s momentum “basket” reportedly dropped about 35% from a June peak, pushing many names closer to oversold levels. A technical read on SMH’s 14-day RSI moved back above the 50-neutral mark to about 55.6, suggesting improving momentum and potential room to extend recovery if earnings remain supportive.