Memory chip stocks fall into a bull market amid latest tech sell-off

00:00 Jerry

So let’s take a look at the semiconductor board. They are in a bear market now. Uh we got more analysis on that in a minute, but just wanted to show you a lot of dark red here. Intel down 10%. Uh this is only today. Applied materials down almost eight and Lamb research down eight as well. But in software land, things are looking pretty good. In fact, over the last seven days, we’ve seen a lot of strength in software as semiconductors have rolled over and we got uh Salesforce up 3%, so is service now and ADP and IBM and Pater, all those up 3% along with an two it.

00:35 Jerry

Uh and let me just go to the Dow here because that’s where we’re seeing a little bit more green. Not in the industrials, industrials are rolling over, uh kind of bucking the strength that we’ve seen recently. Caterpillar down four and a half percent, Boeing down one, but uh those staples names that I was mentioning before as a pocket of strength, J&J up almost 3%, Walmart up one. Uh and then we got those software names kicking and then healthcare wise, we got United health up 1.7% and some other names.

00:59 Jerry

So, all in all, market not looking the best today, but really that uh weakness concentrated in those chip names.

01:07 Speaker B

Well, tell us more, Jerry, we’ve got you about that fall we’re seeing in memory stocks. Walk us through it.

01:12 Jerry

Yeah, so I’ve been talking about broad-based chip weakness, but let me talk about memory stocks in particular and for that I’m specifically focusing on DRAM. That’s a relatively new ETF launched in April and here you can see over the last seven days, this is since that June 25th top in semiconductors, it is down uh about 22%. So I show you the seven-day chart there.

01:34 Jerry

Now, this ETF, as I said, it launched in early April, still sitting on gains of 120%, but it has gone nowhere over the last five weeks or so.

01:45 Jerry

I do want to point out though, and I’m writing this up for my chart of the day, Wednesday morning that Megacaps have bucked the trend. So since that June 25th pivot, as semiconductors have fallen, software stocks and Megacap stocks of specifically the mag 7 have gone up.

02:03 Jerry

So here’s Mag 7 versus chips. You can see up nine per seven, uh up 9% for the Mag 7 down 12% for the socks and we can also see this in semi uh cyber security versus semis where we have uh cyber and I was showing this chart yesterday when we had a six day view that is up 11%. So, there are some uh there are some pockets of weakness in the market, but overall, things are holding up pretty well.