NEW YORK, July 20, 2026, 4:06 p.m. EDT
U.S. equities finished Monday down, even as chipmakers bounced back. The S&P 500 declined 0.19% to end at 7,443.40. The Dow dropped 0.59%, and the Nasdaq edged 0.05% lower. The PHLX Semiconductor Index added 0.60%.
The split serves as a signal to investors. Monday’s advance in chip stocks recouped just 2.4% of the index’s peak-to-Friday decline, according to closing figures. The index stays roughly 19.7% under its June 22 all-time high.
The narrowing gap was evident. The final column displays how much each index lagged behind semiconductors.
| Index | Close | Monday change | Lag behind SOX |
|---|---|---|---|
| Dow Jones Industrial Average | 51,841.10 | -0.59% | 1.19 percentage points |
| S&P 500 | 7,443.40 | -0.19% | 0.79 percentage points |
| Nasdaq Composite | 25,508.07 | -0.05% | 0.65 percentage points |
| PHLX Semiconductor Index | 11,743.85 | +0.60% | — |
The chip index finished Friday 20.2% under its peak, posting a loss of over 18% in July. However, it was still close to 65% higher in 2026, compared to an approximate 9% rise for the S&P 500.
“We’re seeing a bit of a turnaround in some of these semiconductor stocks that were under pressure,” Peter Cardillo, chief market economist at Spartan Capital Securities, said. The rally later gave back roughly 60% of its gains recorded earlier in the afternoon. Reuters
Shares of Advanced Micro Devices NASDAQ:AMD rose following the company’s deepened collaboration with Microsoft NASDAQ:MSFT. Microsoft is set to roll out AMD’s Helios rack system on Azure, with AMD projecting shipments to begin in the second half of 2026.
Microsoft CEO Satya Nadella described the platform as providing “performance, scale and choice.” With this rollout, AMD secures a hyperscale client by name. However, the move does not resolve ongoing arguments over the industry’s valuation. Advanced Micro Devices, Inc.
The next major update arrives soon. Alphabet NASDAQ:GOOGL is set to release results on Wednesday at 4:30 p.m. EDT, followed by Intel NASDAQ:INTC, which reports after markets close on Thursday.
LSEG LON:LSEG consensus forecasts indicate S&P 500 earnings are expected to rise 26% from a year ago, up from a previous estimate of 23.7%. This increased expectation gives companies less space for conservative AI investment strategies.
Kevin Mahn, chief investment officer at Hennion & Walsh, warned that an Alphabet reduction in spending might trigger “ripple effects across the entire AI ecosystem.” Reuters
Macro headwinds resurfaced. Brent crude finished at $89.22 per barrel, gaining 1.3%. The yield on the 10-year Treasury climbed to 4.60%, up from 4.55% on Friday.
The mix pushes up discount rates applied to growth stocks, and increases the profits required to justify elevated valuations.
Risks are balanced on both sides. A drop in oil prices or robust earnings could extend the rebound. Conversely, rising yields, increased tensions in the Gulf, or weaker AI spending may trigger renewed selling.
Monday provided a rebound, but not definitive confirmation. Sustained improvement requires chip stocks to advance, supporting the Nasdaq and expanding beyond select AI-related names.
Related articles: NASDAQ:AMD
