Just Days After Hitting a Record Peak, This Chip ETF Gets Caught in a Perfect Storm

US jobs data sparks rate hike fears; Broadcom's AI revenue guidance miss hits chip stocks - VanEck Semiconductor ETF drops 7.8% from high

For a brief moment on Wednesday, the VanEck Semiconductor UCITS ETF looked untouchable, touching a fresh 52-week high of €102.98. By Friday’s close, it had shed nearly 8%, settling at €92.04 as a pair of unrelated jolts — a much stronger-than-expected US jobs report and a cautious outlook from portfolio heavyweight Broadcom — conspired to hammer the fund.

The May employment data showed 172,000 new positions were added, almost double the 85,000 economists had penciled in. Far from a cause for celebration, the number reignited fears that the Federal Reserve will keep interest rates elevated, a particular headache for high-growth tech stocks whose distant earnings streams get discounted harshly when borrowing costs stay up. The Nasdaq Composite tumbled 4.2% on Friday, and the S&P 500 gave back 2.6%.

Compounding the macro headwind, Broadcom delivered its own dose of disappointment. The chipmaker’s second-quarter revenue rose 48% year on year to $22.19 billion and AI-related chip sales surged 143% to $10.8 billion — all strong on the surface. But the market’s attention fixed on the third-quarter guidance: AI chip revenue of $16 billion, well short of the $17.2 billion analysts had been expecting. Broadcom also left its full-year AI semiconductor forecast unchanged, and CEO Hock Tan acknowledged that Google would diversify its chip suppliers while warning that the mix shift toward AI products would eat into gross margins. The stock plunged 14% on June 4.

The selloff quickly rippled across the sector. Over two trading sessions, Micron Technology cratered 17%, Advanced Micro Devices lost 12.6%, and Intel fell 9%. On Friday alone, AMD slid 10.86% and Intel 11.28%. Other names caught in the downdraft included ASML, which dropped 3.8%, Infineon (down more than 6%), and equipment makers KLA, Applied Materials and Lam Research, each shedding between 5% and 6%. The Philadelphia Semiconductor Index sank 5.21% to 12,907.8 points on June 5, one of its worst single-day losses since early 2025.

The ETF’s concentrated structure amplified the pain. The fund holds 28 individual stocks, but its top five positions — Micron (12.09%), AMD (11.45%), Intel (8.91%), Broadcom (8.31%) and Nvidia (8.07%) — together account for nearly half the portfolio. With Micron, AMD, Intel and Broadcom alone representing roughly 41% of assets, the double-digit declines in those names translated directly into the fund’s slide from Tuesday’s high to Friday’s close. The top ten holdings make up close to 80% of the portfolio, leaving little room for diversification to soften the blow.

The shockwaves reached Asia, too. South Korea’s Kospi index fell 5.54% on Friday, with Samsung Electronics losing 6.4% and SK Hynix dropping nearly 10%.

Despite the carnage, the longer-term picture remains formidable. The ETF is still up 67.47% year to date, and its 12-month return clocks in at 147%. The 50-day moving average of €78.45 sits well below the current price, and the relative strength index of 55.1 indicates neutral territory — neither overbought nor oversold. The annualised 30-day volatility of 46.22% underscores just how jittery the market has become around AI infrastructure names and monetary policy.

Underpinning the secular thesis, global semiconductor equipment sales rose 14% in the first quarter of 2026 to $36.55 billion, driven by AI data centre buildouts and new wafer technologies. That solid demand backdrop clashes with the near-term valuation anxiety triggered by the jobs data and Broadcom’s tepid guidance.

Investors now face two key catalysts. Micron, the fund’s largest single holding, reports quarterly results on June 24 — a report that could set the tone for the entire chip complex through the summer. Then in July, the Federal Reserve’s interest-rate decision will clarify just how seriously policymakers view the recent string of strong employment numbers. Until then, the tug-of-war between structural growth and cyclical headwinds looks set to continue.