Semiconductor lag shadows Nasdaq’s record run
The Philadelphia Semiconductor Index remains 14% below its June peak, while breadth indicators point to weakness beneath the market’s rally.
The Nasdaq Composite reached record highs on consecutive days this week, but gains in the technology-heavy index have not been matched across the semiconductor sector. The Philadelphia Semiconductor Index was 14% below its June high, according to figures cited by Yahoo Finance.
BTIG strategist Jonathan Krinsky said only AMD, Nvidia and Taiwan Semiconductor were closer to their highs than the index itself. Ten of its 30 constituents were more than 30% below their 52-week highs, while the average constituent was down 26%.
GlobalFoundries, KLA and On Semiconductor were each more than 40% below their 52-week highs, Krinsky said. The divergence suggests the record-setting index performance is masking uneven results among chip stocks.
Krinsky also pointed to five consecutive days when more S&P 500 stocks made 52-week lows than highs, even as the broad index recovered near record levels. He compared the dispersion with patterns after an initial market decline in 2000, when some semiconductor stocks later made new highs while the sector index did not.
Krinsky said near-term trading could be choppy and expressed caution over the medium term. His comparison is a warning about market breadth, rather than evidence that markets will repeat the course of 2000.
