According to the Kobeissi Letter, the 30-day correlation between the largest U.S. capital expenditure spenders and the Philadelphia Semiconductor Index has approached zero, reaching its lowest level in at least 4.5 years, down from 0.78 in April and below the 0.60 average since 2022. Since early June, semiconductor stocks have risen while the shares of major investors in AI infrastructure have weakened. Chipmakers are benefiting from growing AI demand, while hyperscale cloud providers face skepticism over the return on their high capital expenditures. The core of AI trading has shifted from scale of investment to profitability.
U.S. capital spending giants show near-zero correlation with the Philadelphia Semiconductor Index
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Summary
The Fear and Greed Index shows a near-zero 30-day correlation between top U.S. capital-spending firms and the Philadelphia Semiconductor Index—the lowest in 4.5 years. This marks a decline from 0.78 in April to below the 2022 average of 0.60. Since early June, chip stocks have risen while major AI infrastructure companies have lagged. Chipmakers benefit from AI demand, while cloud providers face uncertainty over returns. Profitability, not spending, is now the key test for AI investors approaching resistance levels.
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