Analysis: Data Center Investment Outlook Shifts, US Semiconductor Stocks Suffer Sharp Selloff

Odaily Report: Semiconductor stocks fell sharply, extending their recent decline. As Democrats performed strongly in the US midterm elections, investors began to question the prospects of the AI trading theme. The Philadelphia Stock Exchange Semiconductor Index dropped 9.2%, on track for its largest single-day decline since June. It has fallen about 12% this week; if that decline holds, it would mark the worst weekly performance since April 2025, and the index is poised for a fifth consecutive weekly drop, which would be its longest losing streak since April 2025.

The selloff also spread from chipmakers to other areas of the AI supply chain. Storage device makers Western Digital and Seagate Technology both fell more than 14%; so-called "neocloud" companies CoreWeave and Nebius Group also posted steep declines. Still, not all investors on Wall Street have lost faith in chipmakers. Deutsche Bank, for example, said the semiconductor sector remains attractive relative to software, and that semiconductor stocks still stand out in investment value, especially compared with the software industry.