SMH Stock Recent News

Matt Bryson, Wedbush analyst, joins 'Squawk on the Street' to discuss the state of the semiconductor industry.

After months of consolidation, the semiconductor sector looks poised for a significant breakout, reigniting investor interest in this recent market-leading industry. Following a strong run in 2023 and the first half of 2024, semiconductors faced challenges midyear.

Chinese start-up DeepSeek trained and developed one of the most powerful AI models with inferior GPUs, for a very modest budget of less than $6M. This suggests that the Gen AI capex is likely to plummet as other companies follow the DeepSeek V3 innovation. SMH is heavily concentrated, with only 3 stocks accounting for 42% of the index, thus vulnerable for a sharp selloff as the Gen AI bubble continues to burst.

Gain insights into 2025's top tech trends and market opportunities. Learn what experienced investors should consider for smart tech investments.

The recent stock market rally has seen the S&P 500 Index and Dow Jones Industrial Average make new highs but not the Nasdaq Composite. By itself, this is somewhat worrisome for tech investors.

Nvidia (NVDA) has been one of the most interesting stocks of the year. The company isn't new to disruptive technology and has been known for its innovations in computer graphics and gaming years before it became a household name.

SMH and SOXX offer exposure to a highly attractive semiconductor space that strives in the ongoing AI revolution. AI's increasing demand drives semiconductor growth, with both ETFs' holdings like NVIDIA and Broadcom providing essential hardware for AI advancements. Investors who choose to avoid cherry-picking in the first place should be better off with SOXX as it offers a higher degree of diversification than comparable SMH.

Driven by demand from cloud computing and AI, semiconductor sales have skyrocketed in recent months as pressure due to supply chain concerns and inflation has eased. The specialized chips that power these popular technologies are in such high demand that makers of these products now represent three of the 10 largest companies in the world by market capitalization—NVIDIA Corp., Taiwan Semiconductor Manufacturing Co. Ltd.

If you're tempted to buy the dip on the broad basket of semiconductor stocks but aren't quite sure which names to go after, perhaps an exchange-traded fund (ETF) can help you gain the exposure you need in a cost-effective manner.

The VanEck Semiconductor ETF is a great way to invest in AI.