Some semiconductor manufacturers have seen their share prices triple or explode even higher in the first half of 2026, as investors flooded into companies supplying the hardware powering the artificial intelligence boom. The rotation into chip stocks has reshuffled global markets, with Asia Pacific exchanges surging while software giants stumbled.
South Korea's Kospi index delivered its strongest first half since at least 1990, climbing 125% year to date. Samsung led the charge, jumping 183%, while SK Hynix rocketed 310% since January. Both manufacturers reported enormous demand as AI companies raced to secure chips for their datacentre operations.
American chipmakers matched that intensity. Sandisk shares exploded 780% so far this year, having surged 4,510% over the preceding 12 months. Western Digital gained 240%, Micron rose 296%, and Seagate climbed 226%, with two trading days remaining in the first half.
Dan Coatsworth, head of markets at investment platform AJ Bell, framed the magnitude plainly: "Demand exceeding constrained supply led to a surge in memory chip prices and took suppliers' shares on a spectacular ride upwards. Higher selling prices and greater demand is a powerful cocktail for explosive earnings growth." He noted that the six month gains rivaled what investors might expect over decades of normal market activity.
The spike in chip costs rippled across consumer tech. Apple last week raised prices on iPads and MacBooks, citing memory chip expenses. The company is also reportedly seeking Trump administration approval to purchase memory chips from CXMT, a Chinese manufacturer blacklisted by the Pentagon.
The hardware rally came at the expense of software stocks. Microsoft fell 24% during 2026 and hit a one-year low last week. Investors have grown wary of the massive capital spending plans announced by leading AI firms, concerned that higher borrowing and constrained cashflow will strain balance sheets and shift these companies toward more capital-intensive business models.
Recent trading suggested momentum may be cooling. Chip stocks retreated from their highs as investors rotated out of tech into other sectors. Chris Beauchamp, chief market analyst at IG, attributed the shift to profit-taking after the tech rally that followed March: "Having piled in to AI and tech since the end of March, there is a desire to protect profits, and investors continue to be in a mood to sell first and ask questions later."
Broader market performance varied across regions in the first half. Japan's Nikkei climbed 38%. The UK's FTSE 100 gained 5.8%, though it pulled back from a February record when the Iran war rattled markets. Takeover activity buoyed London stocks, with Beazley, DCC, Glencore, Schroders, Segro, and Intertek drawing acquisition interest.
The US S&P 500 rose 7.4% to close the half at 7,354 points. Crude oil prices moved sharply higher, opening the year at $60 per barrel and reaching $12 above that by late June. Oil had spiked above $120 in late April when the closure of the Strait of Hormuz triggered supply fears.
Mark Haefele, chief investment officer at UBS Global Wealth Management, predicts continued upside ahead. He forecasts the S&P 500 will reach 8,200 points by June 2027, supported by sustained AI capital spending, US economic resilience, global fiscal stimulus, and robust credit expansion driving corporate earnings growth.
Author James Rodriguez: "The chip rally has been extraordinary, but investors are right to wonder whether the AI spending story can sustain these valuations when the easy money has already been made."
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