Intel is leading a global shift in semiconductor markets as the rally around artificial intelligence expands beyond early leaders. While Nvidia has long dominated the AI trade, Intel shares surged 114% in April alone. For 2026 through mid-May, the company’s 214.6% return is more than eight times that of Nvidia. The shift marks a new focus on "inference" chips—those used to generate AI answers—rather than just the chips used to train large models.
AI takes over emerging markets
The concentration of chip manufacturing has turned the MSCI Emerging Markets Index into a proxy for the AI industry. Because MSCI classifies Taiwan and South Korea as emerging markets, their technologically advanced economies now account for 43.7% of the index weight. This is nearly double the weight of China, which is capped at 23%.
- TSMC, Samsung Electronics, and SK Hynix are now the three largest components of the MSCI Emerging Markets Index.
- The Philadelphia Semiconductor Index, which tracks global firms like ASML and TSMC, has gained 70.5% this year.
- The emerging market benchmark rose 22.2% through Thursday, significantly outperforming the S&P 500’s 8.8% gain over the same period.
Bubble warnings. The rapid ascent of the semiconductor sector is drawing comparisons to the dot-com era. Analysts at Bespoke Investment Group noted that the chip index hasn't outperformed the S&P 500 by this much since 2000. Hedge fund manager Michael Burry has also issued warnings, stating the current market feels like the final months of the 1999–2000 tech bubble.
Geopolitical risks remain a primary bottleneck for this global trade. While the Strait of Hormuz acts as a chokepoint for oil, the Taiwan Strait serves as a similar pressure point for the world’s supply of advanced silicon. Any political tremor in East Asia threatens the "silicon shield" provided by TSMC’s production facilities.
