Barron: SOX Index Mounts Massive Intraday Comeback

The PHLX Semiconductor Index on Friday was just below the flatline, climbing from a session low of

-5.7%and even briefly traded in the green.

The index, which uses the ticker SOX, was down 0.2% as chip selling eased. The Nasdaq and the SP

500 pared their losses somewhat, with the indexes down 1% and 0.8%, respectively. The Dow, meanwhile, was down 0.5% or 266 points.

Memory chipmakers led the charge, with the Roundhill Memory Chip ETF up 4.5%. Seagate, Micron, and Sandisk were some of the best-performing SP 500 components.

Baird tech strategist Ted Mortonson told Barrons the chip selloff has simply gone too far. He explained that the chip group had dipped into a technical bear market, despite no change in cloud spending plans.

The upcoming Big Tech earnings could be a chance for the market to validate the AI trade, with Mortonson expecting a violent pivot back to semis.

All three major indexes are on track to close the week lower, with the tech-heavy Nasdaq seeing the most significant declines.