Intel shares soared 114% in April and have gained 214.6% so far in 2026, outpacing Nvidia’s year-to-date returns by more than eight times. This surge marks a sharp turnaround for the semiconductor giant, which required a U.S. government bailout only a year ago. The rally reflects a shift in market focus toward "inference" chips—those used to generate AI responses to user queries—rather than the training-specific chips that drove previous gains.
The AI concentration
The artificial intelligence boom is no longer contained to a few U.S. tech giants. The MSCI Emerging Markets Index rose 22.2% through mid-May, significantly outperforming the S&P 500’s 8.8% return. Much of this growth is concentrated in specific semiconductor hubs and resource exporters:
- Taiwan and South Korea. Markets in Taiwan and South Korea are among the world’s best performers this year, powered by Samsung Electronics, SK Hynix, and TSMC.
- Energy producers. Ghana and Nigeria have joined the top four global performers as they profit from rising oil prices sparked by conflict in the Persian Gulf.
- Dutch manufacturing. ASML, which produces the machines required to etch advanced circuits, remains a central pillar of the Philadelphia Semiconductor Index.
Rising risks. Goldman Sachs strategist Ben Snider warns that the AI-driven rally is becoming "one big trade," creating high levels of concentration across global indexes. This sentiment is echoed by hedge fund manager Michael Burry, who recently characterized the current environment as a tech bubble similar to the 1999-2000 period. The reliance on a handful of specialized companies has made even broad index funds less diversified than in previous years.
Geopolitical bottlenecks now serve as the primary threat to these gains. While the Strait of Hormuz remains a chokepoint for global oil supply, the Taiwan Strait has become an equally vital economic corridor due to the global reliance on TSMC’s advanced foundries. Any disruption to Taiwan’s production would immediately impact the designs of Nvidia and other major chip players.
