Chip Rout Tests the AI Trade as Gulf Risks Lift Oil

What moved markets

Reuters reported that a renewed selloff in chipmakers spread through global markets on Friday, while renewed Middle East tensions added another layer of risk aversion and supported oil prices. The combination matters because technology shares have carried a large share of recent equity-market momentum, while higher energy costs can complicate the inflation and rate outlook.

CNBC reported that the Nasdaq Composite fell 1.47% in the prior U.S. session and the VanEck Semiconductor ETF lost almost 4%. It also reported Friday weakness across Asian technology names: Taiwan Semiconductor Manufacturing Co. fell 3.64%, while Hong Kong-listed Tencent, Meituan and Kuaishou declined 1.3%, 2.4% and 3.3%, respectively.

AI investment scrutiny is broadening

The move was not simply a reaction to one company. CNBC noted that TSMC raised its full-year capital-expenditure forecast to $60 billion–$64 billion, from $52 billion–$56 billion, yet investors remained focused on whether the sector's aggressive spending cycle can sustain the returns implied by elevated valuations.

Market takeaway: Strong AI investment plans are no longer automatically a positive for semiconductor equities. Investors are increasingly testing spending against the durability and timing of monetisation.

Oil risk remains a separate pressure point

Oil's rise added to the defensive tone. Reuters attributed the risk backdrop in part to renewed Gulf hostilities. The Energy Information Administration said in its July outlook that increased flows through the Strait of Hormuz had recently put downward pressure on oil prices, but also cautioned that 2026 tanker-flow estimates are being revised frequently as signal data and conditions evolve.

Transmission channel	Why it matters now
Semiconductor valuations	A broader derating can weigh on index-heavy technology exposure.
Oil and shipping risk	Any disruption to Gulf flows can quickly rebuild an energy risk premium.
Rates and inflation	Higher energy costs can make an already sensitive policy outlook harder to read.

What to watch next

For equities, the immediate test is whether the chip selloff stabilises after the latest earnings and capital-expenditure signals. For macro markets, oil's reaction to Gulf developments and evidence on actual Hormuz flows will remain important. A durable recovery in risk appetite likely requires both clearer confidence in AI spending returns and no further deterioration in the energy-supply outlook.

Sources: Reuters; CNBC; U.S. Energy Information Administration.