Global Markets Investor
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Global Markets Investor
globalmarketsinvestor.beehiiv.com
Financial research platform covering global markets Founded by a Wall Street equity and macro research professional.
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🔴Are US semiconductor stocks heading for a rough few months?
Semiconductor stocks, tracked by the $SOX index, have moved in close lockstep with silver mining stocks over the last year, with silver stocks leading the pattern by ~4 months, according to Morgan Stanley.
Both groups posted parabolic rallies tied to strength in their underlying commodity markets.
Silver stocks already PEAKED and rolled over earlier this year, and if the relationship holds, semiconductor stocks could face further downside ahead, led by memory names, the most commodity-like segment of the sector.
Semiconductor strength looks unsustainable given how heavily it depends on hyperscaler capital spending.
Recent weakness in semis was amplified by Meta announcing plans last week to sell excess data center capacity, unused computing power originally built for its own AI needs, to outside customers.
This signals Meta may have overbuilt relative to actual demand and may not need to purchase as many chips going forward.
The AI infrastructure trade may be entering a period of demand reality checks.
Semiconductor stocks, tracked by the $SOX index, have moved in close lockstep with silver mining stocks over the last year, with silver stocks leading the pattern by ~4 months, according to Morgan Stanley.
Both groups posted parabolic rallies tied to strength in their underlying commodity markets.
Silver stocks already PEAKED and rolled over earlier this year, and if the relationship holds, semiconductor stocks could face further downside ahead, led by memory names, the most commodity-like segment of the sector.
Semiconductor strength looks unsustainable given how heavily it depends on hyperscaler capital spending.
Recent weakness in semis was amplified by Meta announcing plans last week to sell excess data center capacity, unused computing power originally built for its own AI needs, to outside customers.
This signals Meta may have overbuilt relative to actual demand and may not need to purchase as many chips going forward.
The AI infrastructure trade may be entering a period of demand reality checks.
🚨Most US tech stocks are already in a BEAR MARKET:
59% of S&P 500 technology stocks are now trading at least 20% below their 252-day highs, the highest share since April, according to Turning Point Market Research.
This matches a similar surge seen in February-March 2025, before the entire market corrected.
Interestingly, the S&P 500 Information Technology index has declined -8.4% since early June.
In other words, just a few mega-cap winners are holding the tech sector from a bear market.
Breadth is deteriorating rapidly beneath the surface. Is the market heading for a correction?
59% of S&P 500 technology stocks are now trading at least 20% below their 252-day highs, the highest share since April, according to Turning Point Market Research.
This matches a similar surge seen in February-March 2025, before the entire market corrected.
Interestingly, the S&P 500 Information Technology index has declined -8.4% since early June.
In other words, just a few mega-cap winners are holding the tech sector from a bear market.
Breadth is deteriorating rapidly beneath the surface. Is the market heading for a correction?
🔴The long US Dollar trade is the most crowded in over a decade:
Speculative long positioning in the US Dollar surged to nearly +$40 billion as of June 30, the highest level since 2015, according to the CFTC.
This covers hedge funds, asset managers, and currency speculators, who take positions based on price trends and macro views instead of hedging existing currency exposure.
Net long positioning has surged over +200% over the last 2 months, and has now lasted 16 consecutive weeks.
Meanwhile, the US Dollar rose +2% in June, one of its strongest months over the past year.
This comes as traders now price in at least one Fed rate hike this year, a sharp reversal from expectations of rate cuts before the Iran war began in late February.
Is the US Dollar rally overdone?
Speculative long positioning in the US Dollar surged to nearly +$40 billion as of June 30, the highest level since 2015, according to the CFTC.
This covers hedge funds, asset managers, and currency speculators, who take positions based on price trends and macro views instead of hedging existing currency exposure.
Net long positioning has surged over +200% over the last 2 months, and has now lasted 16 consecutive weeks.
Meanwhile, the US Dollar rose +2% in June, one of its strongest months over the past year.
This comes as traders now price in at least one Fed rate hike this year, a sharp reversal from expectations of rate cuts before the Iran war began in late February.
Is the US Dollar rally overdone?
Verified
⚠️What is happening with the US labor market?
The number of employed people in the US dropped -507,000 in June, the 3rd-largest drop since January 2024.
This brings the difference between nonfarm payrolls and the household survey to 564,000 jobs last month.
Year-to-date, total employment in the household survey has declined -1.7 MILLION.
Over the same period, total nonfarm employment has risen +552,000.
The key difference is that the establishment survey can count the same person twice if they hold two jobs, while the household survey counts each person only once, regardless of how many jobs they have.
In the past, such a decline in the household survey has never occurred outside of a recession.
Under the surface, the US job market is in a recession.
The number of employed people in the US dropped -507,000 in June, the 3rd-largest drop since January 2024.
This brings the difference between nonfarm payrolls and the household survey to 564,000 jobs last month.
Year-to-date, total employment in the household survey has declined -1.7 MILLION.
Over the same period, total nonfarm employment has risen +552,000.
The key difference is that the establishment survey can count the same person twice if they hold two jobs, while the household survey counts each person only once, regardless of how many jobs they have.
In the past, such a decline in the household survey has never occurred outside of a recession.
Under the surface, the US job market is in a recession.
🔴Long-term market valuations are flashing a historic warning for US stocks:
The S&P 500's cyclically adjusted price-to-earnings ratio (CAPE) rose above 40x, the highest since the 2000 Dot-Com Bubble.
Excluding 2000, this is above every other market peak recorded over the last ~140 years.
Following the 2000 peak, the S&P 500 delivered a -9% cumulative nominal return and a -29% cumulative real (after inflation) return over the next 10 years.
At the only other comparable valuation extreme in 1929, the index returned -29% nominal and -13% real over the following decade.
By contrast, buying after major market bottoms has historically produced some of the strongest long-term returns, including a +475% nominal gain following the 1982 low.
History suggests that extreme valuations have consistently led to weak long-term returns.
The S&P 500's cyclically adjusted price-to-earnings ratio (CAPE) rose above 40x, the highest since the 2000 Dot-Com Bubble.
Excluding 2000, this is above every other market peak recorded over the last ~140 years.
Following the 2000 peak, the S&P 500 delivered a -9% cumulative nominal return and a -29% cumulative real (after inflation) return over the next 10 years.
At the only other comparable valuation extreme in 1929, the index returned -29% nominal and -13% real over the following decade.
By contrast, buying after major market bottoms has historically produced some of the strongest long-term returns, including a +475% nominal gain following the 1982 low.
History suggests that extreme valuations have consistently led to weak long-term returns.
Verified
‼️Strategy is changing its Bitcoin playbook:
Strategy, $MSTR, sold 3,588 bitcoin for $216 million between June 29 and July 5, the largest single disposal in company history.
The sale helped fund dividends across 5 preferred securities, which together carry an estimated ~$1.5 billion in annual obligations, according to Grayscale, far more than the company's software business generates.
Strategy's bitcoin holdings carry a cost basis of ~$63.9 billion, or ~$75,700 per coin, across 843,775 bitcoin held as of July 5.
This marks Strategy's 2nd bitcoin sale in 2 months, following a much smaller 32 bitcoin sale in late May, its first disposal since 2022.
Even so, the company continues accumulating bitcoin, purchasing ~$2.0 billion in May and another ~$2.54 billion in April.
The bitcoin treasury is becoming an active source of liquidity.
Strategy, $MSTR, sold 3,588 bitcoin for $216 million between June 29 and July 5, the largest single disposal in company history.
The sale helped fund dividends across 5 preferred securities, which together carry an estimated ~$1.5 billion in annual obligations, according to Grayscale, far more than the company's software business generates.
Strategy's bitcoin holdings carry a cost basis of ~$63.9 billion, or ~$75,700 per coin, across 843,775 bitcoin held as of July 5.
This marks Strategy's 2nd bitcoin sale in 2 months, following a much smaller 32 bitcoin sale in late May, its first disposal since 2022.
Even so, the company continues accumulating bitcoin, purchasing ~$2.0 billion in May and another ~$2.54 billion in April.
The bitcoin treasury is becoming an active source of liquidity.
⚠️Hedge funds are ramping up bearish yen bets to a scale not seen in almost 2 decades:
Net SHORT yen positioning among leveraged funds has surged to almost 138,000 contracts as of June 30, the most bearish reading since 2007, according to the CFTC.
This comes as the yen trades near 162 per dollar, its weakest level since 1986.
The wide interest rate gap between the US and Japan remains the primary driver, making the yen carry trade, borrowing cheaply in yen to fund higher-returning Dollar assets, increasingly attractive.
While the Bank of Japan delivered an expected rate hike in June, any support for the yen was overshadowed by Fed Chair Kevin Warsh reaffirming his commitment to restoring US price stability.
Japan's currency faces additional pressure from Prime Minister Sanae Takaichi's large spending plans and her preference for monetary easing.
Notably, Japanese authorities spent a record ¥11.73 trillion, or $72.7 billion, defending the yen between April 28 and May 27 alone.
Is another FX intervention becoming inevitable?
Net SHORT yen positioning among leveraged funds has surged to almost 138,000 contracts as of June 30, the most bearish reading since 2007, according to the CFTC.
This comes as the yen trades near 162 per dollar, its weakest level since 1986.
The wide interest rate gap between the US and Japan remains the primary driver, making the yen carry trade, borrowing cheaply in yen to fund higher-returning Dollar assets, increasingly attractive.
While the Bank of Japan delivered an expected rate hike in June, any support for the yen was overshadowed by Fed Chair Kevin Warsh reaffirming his commitment to restoring US price stability.
Japan's currency faces additional pressure from Prime Minister Sanae Takaichi's large spending plans and her preference for monetary easing.
Notably, Japanese authorities spent a record ¥11.73 trillion, or $72.7 billion, defending the yen between April 28 and May 27 alone.
Is another FX intervention becoming inevitable?
Partly True
🚨South Korea market just had another ROUGH DAY:
The KOSPI dropped as much as -11% on Tuesday, triggering a market-wide circuit breaker, before paring losses to close down -5%.
The selloff was led by Samsung Electronics, which fell as much as -10.1%, and SK Hynix, which fell as much as -10.6%, despite what looked, at first glance, like a blowout earnings report from Samsung.
Samsung forecast a record Q2 operating profit of 89.4 trillion won, or $58.4 billion, a 19-fold increase YoY, beating the 87.3 trillion won consensus estimate.
However, revenue missed expectations, with Samsung guiding to 171 trillion won versus consensus near 172 to 174 trillion won, as DRAM price increases came in more moderate than investors had priced in.
This comes as lofty expectations were already priced in after the stock's sharp rally into the print, alongside broader concerns that AI data center spending by major US tech firms could slow.
Contagion spread across the region, with Japan's Kioxia falling as much as -12%, and chip equipment suppliers Tokyo Electron and Screen Holdings also declining.
The chip stock bubble is seeing some serious cracks.
The KOSPI dropped as much as -11% on Tuesday, triggering a market-wide circuit breaker, before paring losses to close down -5%.
The selloff was led by Samsung Electronics, which fell as much as -10.1%, and SK Hynix, which fell as much as -10.6%, despite what looked, at first glance, like a blowout earnings report from Samsung.
Samsung forecast a record Q2 operating profit of 89.4 trillion won, or $58.4 billion, a 19-fold increase YoY, beating the 87.3 trillion won consensus estimate.
However, revenue missed expectations, with Samsung guiding to 171 trillion won versus consensus near 172 to 174 trillion won, as DRAM price increases came in more moderate than investors had priced in.
This comes as lofty expectations were already priced in after the stock's sharp rally into the print, alongside broader concerns that AI data center spending by major US tech firms could slow.
Contagion spread across the region, with Japan's Kioxia falling as much as -12%, and chip equipment suppliers Tokyo Electron and Screen Holdings also declining.
The chip stock bubble is seeing some serious cracks.
‼️The US private sector is going through a hiring recession:
The US private hiring rate fell to 3.5% in May, the 2nd-lowest reading in 15 years.
This is in line with the levels seen during the middle of the Great Financial Crisis.
The private hiring rate has remained below 4.0% for 31 consecutive months.
The US job market is historically weak.
The US private hiring rate fell to 3.5% in May, the 2nd-lowest reading in 15 years.
This is in line with the levels seen during the middle of the Great Financial Crisis.
The private hiring rate has remained below 4.0% for 31 consecutive months.
The US job market is historically weak.
⚠️Hedge funds are DUMPING Asian stocks:
Hedge funds sold Asian equities at the 2nd-fastest pace in June in at least 5 years, only below March.
Japan led the outflows, posting the largest monthly outflow on record.
South Korea followed, reversing all of its year-to-date inflows, with net flows falling from a peak of +5% of Asia's net market value in early June to roughly flat.
Is the semiconductor trade in South Korea coming to an end?
Hedge funds sold Asian equities at the 2nd-fastest pace in June in at least 5 years, only below March.
Japan led the outflows, posting the largest monthly outflow on record.
South Korea followed, reversing all of its year-to-date inflows, with net flows falling from a peak of +5% of Asia's net market value in early June to roughly flat.
Is the semiconductor trade in South Korea coming to an end?
Verified
‼️Japan's weak yen is driving a record wave of bankruptcies:
45 Japanese firms went bankrupt in the first half of 2026, citing the weak yen, the highest H1 total since at least 2022.
This is up +32.4% from 34 in the first half of 2025, and up from 27 in 2023.
This comes as the yen again traded past 162 per dollar this week, around its weakest level since 1986.
Bankruptcies are concentrated in the wholesale sector, where import-dependent firms have little power to pass rising costs onto customers.
Adding to the pressure, many smaller importers hedge with reverse knockout options, contracts that expire once the yen crosses a preset trigger level, forcing firms to buy dollars at the worst possible moment.
Meanwhile, the yen is set to weaken further, to as much as 170 per dollar, which could trigger a fresh wave of failures.
The Japanese economy is increasingly struggling due to FX weakness.
45 Japanese firms went bankrupt in the first half of 2026, citing the weak yen, the highest H1 total since at least 2022.
This is up +32.4% from 34 in the first half of 2025, and up from 27 in 2023.
This comes as the yen again traded past 162 per dollar this week, around its weakest level since 1986.
Bankruptcies are concentrated in the wholesale sector, where import-dependent firms have little power to pass rising costs onto customers.
Adding to the pressure, many smaller importers hedge with reverse knockout options, contracts that expire once the yen crosses a preset trigger level, forcing firms to buy dollars at the worst possible moment.
Meanwhile, the yen is set to weaken further, to as much as 170 per dollar, which could trigger a fresh wave of failures.
The Japanese economy is increasingly struggling due to FX weakness.
⚠️Hedge funds are DUMPING Magnificent 7 stocks at a rapid pace:
Mag 7 gross exposure as a percentage of total hedge fund US exposure has fallen from ~11.5% in late 2025 to 8%, the lowest in over 12 months.
This is the 2nd-lowest level in at least 3 years.
Net exposure has dropped even more sharply, from a peak of ~21.5% to ~14.5% over the same period, also approaching the lowest level since at least 2023.
This comes as the Magnificent 7 has underperformed the broader market in recent weeks, forcing hedge funds to cut long exposure while increasingly betting against the group.
The Magnificent Seven ETF, $MAGS, is down -8% since mid-May.
The group has gone nowhere now for ~9 months.
Has the Magnificent 7 euphoria finished?
Mag 7 gross exposure as a percentage of total hedge fund US exposure has fallen from ~11.5% in late 2025 to 8%, the lowest in over 12 months.
This is the 2nd-lowest level in at least 3 years.
Net exposure has dropped even more sharply, from a peak of ~21.5% to ~14.5% over the same period, also approaching the lowest level since at least 2023.
This comes as the Magnificent 7 has underperformed the broader market in recent weeks, forcing hedge funds to cut long exposure while increasingly betting against the group.
The Magnificent Seven ETF, $MAGS, is down -8% since mid-May.
The group has gone nowhere now for ~9 months.
Has the Magnificent 7 euphoria finished?
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MAGSETF+0.06%
NVDAUS-0.47%
🚨US private credit stocks are plummeting:
Blue Owl Capital shares are down -55.6% over the past 12 months.
This dramatically underperforms Apollo, Blackstone, KKR, Ares, Carlyle, and TPG, all of which are down roughly -17% to -38% over the same period.
This comes as redemption requests at Blue Owl's 2 largest funds totaled $4.7 billion in Q2, still far above the funds' 5% quarterly withdrawal cap.
Its technology-focused fund, OTIC, saw the greatest pressure, with 38.1% of shares tendered for redemption, more than double the 9% to 17% range seen at the largest peer funds that have reported Q2 results.
Its flagship fund, OCIC, saw redemption requests reach 18.8% of shares, alongside $660 million in net outflows.
Across the broader private credit industry, investors requested a record $15.6 billion in redemptions in Q2, with only 38% of requests met, leaving $9.7 billion unmet, the highest amount on record.
The $2 trillion private credit industry crisis is getting worse.
Blue Owl Capital shares are down -55.6% over the past 12 months.
This dramatically underperforms Apollo, Blackstone, KKR, Ares, Carlyle, and TPG, all of which are down roughly -17% to -38% over the same period.
This comes as redemption requests at Blue Owl's 2 largest funds totaled $4.7 billion in Q2, still far above the funds' 5% quarterly withdrawal cap.
Its technology-focused fund, OTIC, saw the greatest pressure, with 38.1% of shares tendered for redemption, more than double the 9% to 17% range seen at the largest peer funds that have reported Q2 results.
Its flagship fund, OCIC, saw redemption requests reach 18.8% of shares, alongside $660 million in net outflows.
Across the broader private credit industry, investors requested a record $15.6 billion in redemptions in Q2, with only 38% of requests met, leaving $9.7 billion unmet, the highest amount on record.
The $2 trillion private credit industry crisis is getting worse.
BXUS-0.02%
APOUS-0.02%
KKRUS-0.04%
🔴Retail trading activity is absolutely EXPLODING:
Average daily retail trading volume, or the total dollar value of stocks traded by mom-and-pop investors, rose to ~1.8x its 2020 to 2026 average in June, the highest ever recorded.
This is up from ~1.5x in May, which had already surpassed every previous monthly record.
At the same time, net retail buying climbed to a record ~3.5x its historical average.
This means retail investors are not only trading more than ever, but are also buying far more stocks than they are selling.
Retail investors are chasing the market like never before.
Average daily retail trading volume, or the total dollar value of stocks traded by mom-and-pop investors, rose to ~1.8x its 2020 to 2026 average in June, the highest ever recorded.
This is up from ~1.5x in May, which had already surpassed every previous monthly record.
At the same time, net retail buying climbed to a record ~3.5x its historical average.
This means retail investors are not only trading more than ever, but are also buying far more stocks than they are selling.
Retail investors are chasing the market like never before.
Verified
🔥Central bank demand for gold is accelerating:
World central banks acquired 41 tonnes of gold in May, following ~20 tonnes in the prior month.
Year-to-date, Poland has been the biggest buyer, adding 64 tonnes and bringing its total gold reserves to a record 614 tonnes, on track to reach its 700-tonne target.
This is followed by Uzbekistan, which added 33 tonnes. Notably, the country's gold reserves now stand at 87% of its total FX reserves.
Meanwhile, China has bought gold for 20 consecutive months, adding 25 tonnes year-to-date and increasing its gold reserves to a record 2,331 tonnes, or 9% of total FX reserves.
Central banks are aggressively buying every dip in gold.
World central banks acquired 41 tonnes of gold in May, following ~20 tonnes in the prior month.
Year-to-date, Poland has been the biggest buyer, adding 64 tonnes and bringing its total gold reserves to a record 614 tonnes, on track to reach its 700-tonne target.
This is followed by Uzbekistan, which added 33 tonnes. Notably, the country's gold reserves now stand at 87% of its total FX reserves.
Meanwhile, China has bought gold for 20 consecutive months, adding 25 tonnes year-to-date and increasing its gold reserves to a record 2,331 tonnes, or 9% of total FX reserves.
Central banks are aggressively buying every dip in gold.
Verified
⚠️Is this why the US unemployment rate is not rising?
The US labor force dropped by -720,000 people in June, the 2nd-largest monthly decline since the 2020 Crisis.
As a result, the labor force participation rate fell -0.3 percentage points, to 61.5%, the lowest in 50 years, excluding the 2020 shutdown of the economy.
This metric measures the working-age population either employed or actively looking for work.
Meanwhile, the unemployment rate fell to 4.2%, but it only counts people who are actively looking for work.
When someone stops looking for a job, they leave the labor force.
Once they leave the labor force, they are no longer counted as unemployed, helping keep the unemployment rate lower than it otherwise would be.
The falling labor force is masking further weakness in the US job market.
The US labor market is MUCH weaker than what the headline data says.
The US labor force dropped by -720,000 people in June, the 2nd-largest monthly decline since the 2020 Crisis.
As a result, the labor force participation rate fell -0.3 percentage points, to 61.5%, the lowest in 50 years, excluding the 2020 shutdown of the economy.
This metric measures the working-age population either employed or actively looking for work.
Meanwhile, the unemployment rate fell to 4.2%, but it only counts people who are actively looking for work.
When someone stops looking for a job, they leave the labor force.
Once they leave the labor force, they are no longer counted as unemployed, helping keep the unemployment rate lower than it otherwise would be.
The falling labor force is masking further weakness in the US job market.
The US labor market is MUCH weaker than what the headline data says.
🔴THIS STAT IS ABSOLUTELY MIND-BLOWING:
South Korea's total market cap to GDP ratio, or the Buffett Indicator, is up to 291.1%, near a record high.
This is more than 3 times the 20-year average of 93.9%.
A modified version of this ratio, which also factors in the total assets of Korea's central bank, stands at 239.4%, also more than 3 times its own 20-year average of 73.9%.
Both readings place Korea in Significantly Overvalued territory, the most extreme of 5 valuation zones tracked by the model.
If these ratios revert to their historical averages over the next 8 years, it implies Korea's stock market could return -8.6% a year, while the modified model implies -9.1%.
Is Korea's historic rally about to run into an equally epic mean reversion?
South Korea's total market cap to GDP ratio, or the Buffett Indicator, is up to 291.1%, near a record high.
This is more than 3 times the 20-year average of 93.9%.
A modified version of this ratio, which also factors in the total assets of Korea's central bank, stands at 239.4%, also more than 3 times its own 20-year average of 73.9%.
Both readings place Korea in Significantly Overvalued territory, the most extreme of 5 valuation zones tracked by the model.
If these ratios revert to their historical averages over the next 8 years, it implies Korea's stock market could return -8.6% a year, while the modified model implies -9.1%.
Is Korea's historic rally about to run into an equally epic mean reversion?
🚨US MARGIN DEBT IS FLASHING A WARNING:
US margin debt as a share of M2 money supply spiked to 6.2% in May.
This is just shy of the all-time record of 6.3%, set at the height of the 2000 Dot-Com bubble peak.
Total margin debt now stands at $1.4 trillion, an all-time high in dollar terms.
Historically, spikes in margin debt relative to money supply have preceded major market tops.
Margin debt peaked in March 2000, just months before the Dot-Com collapse, and again in July 2007, 3 months before the S&P 500 topped out ahead of the Financial Crisis.
Most recently, it peaked in October 2021, 2 months before the S&P 500's December 2021 high, preceding a -25% drawdown through September 2022.
Will history repeat itself?
US margin debt as a share of M2 money supply spiked to 6.2% in May.
This is just shy of the all-time record of 6.3%, set at the height of the 2000 Dot-Com bubble peak.
Total margin debt now stands at $1.4 trillion, an all-time high in dollar terms.
Historically, spikes in margin debt relative to money supply have preceded major market tops.
Margin debt peaked in March 2000, just months before the Dot-Com collapse, and again in July 2007, 3 months before the S&P 500 topped out ahead of the Financial Crisis.
Most recently, it peaked in October 2021, 2 months before the S&P 500's December 2021 high, preceding a -25% drawdown through September 2022.
Will history repeat itself?
⚠️US semiconductor stocks are INCREDIBLY EXPENSIVE:
The semiconductor index $SOX forward P/E ratio hit ~30, near the top of its 15-year range.
Relative to the S&P 500, semiconductors traded as high as ~1.4 times the index's own valuation, also near a multi-year high.
This comes as doubts are rising over whether AI capital spending is delivering a sufficient return.
One closely watched measure of what companies actually pay for AI tokens is down almost 20% from its May peak, after nearly doubling since December.
This may reflect fading pricing power that could weaken the investment case for continued spending.
Meanwhile, Allianz Research estimates the gap between AI investment and AI-related revenue growth at ~46%, wider than the 32% gap during the 2001 telecom bust.
Semiconductor valuations are now increasingly tied to whether AI spending can keep justifying itself.
Are these early signs of a correction in semis pricing power?
The semiconductor index $SOX forward P/E ratio hit ~30, near the top of its 15-year range.
Relative to the S&P 500, semiconductors traded as high as ~1.4 times the index's own valuation, also near a multi-year high.
This comes as doubts are rising over whether AI capital spending is delivering a sufficient return.
One closely watched measure of what companies actually pay for AI tokens is down almost 20% from its May peak, after nearly doubling since December.
This may reflect fading pricing power that could weaken the investment case for continued spending.
Meanwhile, Allianz Research estimates the gap between AI investment and AI-related revenue growth at ~46%, wider than the 32% gap during the 2001 telecom bust.
Semiconductor valuations are now increasingly tied to whether AI spending can keep justifying itself.
Are these early signs of a correction in semis pricing power?
Partly True
🚨US job market revisions are crazy:
US non-farm payrolls for May and April were revised down by a combined -74,000, in the latest June report released on Friday.
Since January 2025, non-farm employment has been revised in 15 of the last 17 months.
During this period, job numbers were adjusted down by a net -778,000.
Since January 2023, 31 of the last 41 months have been revised down.
What is happening here?
US non-farm payrolls for May and April were revised down by a combined -74,000, in the latest June report released on Friday.
Since January 2025, non-farm employment has been revised in 15 of the last 17 months.
During this period, job numbers were adjusted down by a net -778,000.
Since January 2023, 31 of the last 41 months have been revised down.
What is happening here?
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