Shares in chipmakers have surged in the first half of 2026 as investors piled into companies that make the hardware underpinning the AI boom, according to analysis by the London Stock Exchange Group. The value of some semiconductor and memory chip manufacturers has tripled or more, driving Asia Pacific stock markets sharply higher.
South Korea's Kospi Leads the Charge
South Korea's Kospi index is up 125% this year, its strongest first half since at least 1990. This rally was driven by electronics giant Samsung, whose share price jumped 183%, and SK Hynix, which rose 310% since January. Both companies have reported a significant increase in demand as AI companies compete for chips to power their datacentres.
US Chipmakers See Explosive Gains
US chipmakers have also experienced remarkable growth. Sandisk shares surged 780% in 2026 and 4,510% over the past 12 months. Western Digital gained 240%, Micron rose 296%, and Seagate increased 226%, with two trading days left until the second half of the year. Dan Coatsworth, head of markets at AJ Bell, noted: "Demand exceeding constrained supply led to a surge in memory chip prices and took suppliers' shares on a spectacular ride upwards. Higher selling prices and greater demand is a powerful cocktail for explosive earnings growth."
Impact on Tech Giants and Consumers
Apple blamed rising memory chip costs for increasing iPad and MacBook prices last week. The company is reportedly seeking US government clearance to buy chips from CXMT, a Chinese firm blacklisted by the Pentagon. Meanwhile, shares in hyperscalers like Microsoft have fallen 24% in 2026, hitting a one-year low, as investors shifted from software to hardware stocks. Some investors are wary of the huge spending plans by leading AI companies, which have increased borrowing and reduced cashflow.
Signs of Faltering Momentum
Recent days have shown signs of the chip stock boom faltering, with shares pulling back from highs as investors rotate into other sectors. Chris Beauchamp, chief market analyst at IG, said: "Having piled into AI and tech since the end of March, there is a desire to protect profits, and investors continue to be in a mood to sell first and ask questions later."
Broader Market Performance
Japan's Nikkei climbed 38% in the first half of 2026. The UK's FTSE 100 gained 5.8%, despite falling from a record high in late February due to the Iran war. Takeover offers for companies like Beazley, DCC, Glencore, Schroders, Segro, and Intertek supported the London market. Brent crude oil began the year at $60 a barrel and ended June about $12 higher, though it doubled to over $120 in late April due to the closure of the Strait of Hormuz. The US S&P 500 gained 7.4% to 7,354 points. Mark Haefele, chief investment officer at UBS Global Wealth Management, predicts the S&P 500 will reach 8,200 points by June 2027, citing continued AI capital expenditure, a resilient US economy, and strong credit creation.
