Semiconductor ETF Enters Bear Market

The iShares Semiconductor ETF has fallen to $471, its lowest level since July, as AI-linked chip stocks sell off.

Updated on Nov. 1, 2026 in Semiconductors

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The iShares Semiconductor ETF (SOXX) has entered a bear market, falling from a June record high of $656 to $471. The decline follows OpenAI's $11 billion fundraise, which fell short of its $30 billion target and came with a lowered valuation of $1.25 trillion.

Why it matters

The sell-off reflects investor concern that the AI boom may be slowing, with the ETF's largest holdings and AI infrastructure names posting steep losses. Market observers note the decline could signal a broader reassessment of AI-driven valuations.

SOXX has fallen below its 50-week moving average and the 23.6% Fibonacci retracement level, and its Supertrend indicator turned red for the first time in over a year. AMD, the fund's largest constituent, is down 23.20% from its peak this year, while Nvidia has fallen 16%.

The players

iShares Semiconductor ETF (SOXX)

An exchange-traded fund tracking U.S. semiconductor companies, whose price decline is the central subject of this story.

OpenAI

The artificial intelligence company whose reduced fundraise and lowered valuation have been cited as a sign of cooling sentiment toward AI investments.

Ray Dalio

The founder of Bridgewater Associates, a prominent investor who has warned that the AI bubble may burst as interest rates and bond yields rise.

Michael Burry

The investor known for predicting the 2008 housing collapse, who has publicly warned of an AI bubble.

Ken Griffin

The founder of Citadel, a major hedge fund, who has joined warnings that the AI bubble may burst.

The details

Micron, Broadcom, and Intel have entered technical bear markets, and CoreWeave, Nebius, Riot Platforms, and IREN have plunged. Investors cite AI bubble concerns, and Ray Dalio, Michael Burry, and Ken Griffin have warned that rising interest rates and bond yields could burst the bubble.

June: SOXX reached its record high of $656.
July: SOXX last traded at its current level before the recent decline.
Friday: SOXX recorded $1.54 billion in outflows.

The Tech Race

The ETF's decline echoes the dot-com bubble of 1999-2000, when speculative technology valuations fell sharply as interest rates rose. Whether the current AI-driven sell-off follows that path depends on whether funding for AI infrastructure continues to contract.

Investors holding SOXX or semiconductor-heavy index funds face continued price volatility while the sell-off continues. Retirement and brokerage account balances tied to technology stocks may fluctuate as the sector reprices.

The takeaway

Investors should watch whether AI infrastructure funding stabilizes, since the ETF's direction is closely tied to the pace of AI capital spending. Reviewing exposure to concentrated technology holdings can help manage risk during periods of sector-wide decline.