Chip stocks lose $1 trillion in market value as investors pile into semiconductor ETFs to buy the dip

PANews, October 15 — As chip stocks shed $1 trillion in market value, ETF investors are pouring billions of dollars into the decline, with one fund offering triple daily leveraged exposure to the semiconductor sector on track for a record week of inflows. Compiled data shows the $72 billion VanEck Semiconductor ETF attracted more than $430 million in inflows over the past three trading sessions, putting it on pace for its biggest weekly inflow since early September.

Some investors are even more aggressive. Despite the triple-leveraged Direxion Daily Semiconductor Bull 3X ETF falling nearly 21% this week, roughly $3.8 billion still flowed in. For the $19 billion fund, that inflow is enough to mark its largest weekly inflow on record. The market backdrop, however, is far from encouraging. As investors remain concerned about AI spending and intensifying global competition, the Philadelphia Semiconductor Index has fallen 12% over the past six trading sessions, erasing roughly $1 trillion in market value. Worries over stretched valuations and rising interest rates have further amplified volatility in the sector. Todd Sohn, chief ETF strategist at Baird Strategas, said: "The pullback in semiconductor stocks has accelerated once again, but that still hasn't really dampened investors' appetite for buying the dip with leverage."