I'm LongbridgeAI, I can summarize articles.The semiconductor sector faces a rare seven-day losing streak, with the PHLX Semiconductor Index down nearly 14%. Leading the decline are SK Hynix (-24.34%) and Arm Holdings (-21.42%). The sell-off is driven by fears of memory chip oversupply due to Chinese advancements and persistent inflation keeping Fed rate hikes on the table, which increases borrowing costs for AI data centers.
The chips that powered the artificial-intelligence rally are now leading its retreat.
The PHLX Semiconductor Index, the main benchmark for U.S.-listed chipmakers, which is closely tracked by the Invesco PHLX Semiconductor ETF (NYSE:SOXQ), has fallen for seven straight sessions.
That has happened only 15 times since 1994.
The index is down nearly 14% from its Oct. 6 close.
• Invesco PHLX Semiconductor ETF stock is facing resistance. Why is SOXQ stock retreating?
According to Benzinga Pro data, these are the worst-performing stocks over the past seven sessions among companies with at least a $50 billion market cap.
| Company | 7-session change |
|---|---|
| SK Hynix Inc. (NASDAQ:SKHY) | -24.34% |
| Arm Holdings plc (NASDAQ:ARM) | -21.42% |
| Coherent Corp. (NYSE:COHR) | -21.08% |
| Nebius Group N.V. (NASDAQ:NBIS) | -20.02% |
| Seagate Technology Holdings plc (NASDAQ:STX) | -19.56% |
| Teradyne Inc. (NASDAQ:TER) | -19.14% |
| Lumentum Holdings Inc. (NASDAQ:LITE) | -17.89% |
| SanDisk Corp. (NASDAQ:SNDK) | -17.65% |
| Applied Materials Inc. (NASDAQ:AMAT) | -17.64% |
| Western Digital Corp. (NASDAQ:WDC) | -17.56% |
| Astera Labs Inc. (NASDAQ:ALAB) | -17.13% |
| Lam Research Corp. (NASDAQ:LRCX) | -17.03% |
| Monolithic Power Systems Inc. (NASDAQ:MPWR) | -16.00% |
| Intel Corp. (NASDAQ:INTC) | -15.55% |
| Micron Technology Inc. (NASDAQ:MU) | -14.08% |
Two forces are behind the sell-off.
China’s ChangXin Memory Technologies reported progress on a denser memory chip design, raising fears of future oversupply.
Meanwhile, U.S. producer prices rose 6.3% from a year earlier in September, the fastest pace since December 2022. That keeps a Federal Reserve rate hike on the table.
Higher rates make it more expensive to borrow and build AI data centers. As a result, investors are dumping the companies that sell memory, storage and chipmaking tools to those data centers.
The Roundhill Memory ETF (NYSE:DRAM) has lost 21% since its Oct. 5 close.
Image: Shutterstock
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