Chips — Bear Market Again, but Not Like July

The chip stocks are in a bear market again. The Philadelphia chip index, the benchmark for US-listed chip makers, closed Friday at 11,137 — 23.9% below its record close of 14,635 on 22 June and past the 20% line that marks a bear market. It got there in eight losing days in a row, its longest losing streak in 16 years, as reported by Barchart. It is the second time in four months: the index first crossed the line in July, fell as far as 28.6% below the record and then won back 26.5% in ten weeks. So the label is not the news. The news is what fell with the chips this time — and what did not.

Two legs down, side by side

Here are the two sell-offs next to each other: the July leg from the record of 22 June to the low of 29 July, and the October leg from 6 October, the day the Nasdaq-100 set its record, to Friday.

Table as text

Close to close	July leg (22 Jun → 29 Jul)	October leg (6 Oct → 16 Oct)
Chip index (SOX)	−28.6%	−15.7%
Nasdaq-100 fund (QQQ)	−10.3%	−6.6%
Software fund (IGV)	+5.8%	−6.2%
Accenture (ACN)	+38.8%	+18.8%

Closing prices from Yahoo Finance. Chip index record close 14,634.72 on 22 June 2026; July low 10,447 on 29 July; 6 October close 13,218; Friday 11,137.

In July the money that left the chip makers went to software. Software had already been sold hard in June — IGV fell 19% from 1 June to 22 June — and it bounced while the chips fell. This time software is falling with the chips. On Friday IGV lost 4.8%, Snowflake 8.4%, Palo Alto Networks 7.6% and Palantir 7.2%, after Goldman Sachs warned about how much of the AI build-out runs on borrowed money, as reported. The selling has moved from one part of the AI trade to most of it.