US S&P 500 Index

The S&P 500 experienced a volatile week, opening strongly as semiconductor stocks rallied on a record US$21bn of inflows into chip ETFs and a 20% surge in SK Hynix’s ADRs. However, sentiment reversed sharply mid-week after TSMC delivered another strong result but raised FY capex guidance to US$60–64bn, again fuelling concerns AI infrastructure spending may be nearing a peak and future margins could come under pressure.

The sell-off intensified into Friday, with Nvidia (-2.2%) leading a broad unwind in AI-related stocks, while reports of a new Chinese AI model further weighed on sentiment. Despite the sharp pullback, most analysts viewed the move as a rotation out of crowded AI winners rather than a deterioration in fundamentals, with the broader market providing plenty of reasons for investors to spread their wings: approximately ~90% of S&P 500 companies that have reported so far have beaten EPS estimates for 2Q26, well above the historical average of ~75%.

As a side note, SpaceX (SPCX US) reminded investors that making money isn’t always easy as it fell 5.4%, posting fresh trading lows, and more importantly more than 8% below its IPO price which was greeted with fanfare last month.

• We can see the S&P 500 punching higher towards 8000 into Christmas.