SMH ETF Faces Headwinds as AI Rally Cools
The VanEck Semiconductor ETF (SMH) dipped in pre-market trading as its component stocks retreated, signaling fading momentum in the AI-driven rally. With a 46% year-to-date gain now under pressure, investors are reassessing valuations amid concerns about stretched premiums in artificial intelligence equities.
Legal uncertainties compound the sector's challenges. The U.S. Supreme Court's review of presidential tariff authority introduces regulatory ambiguity, particularly for semiconductor firms exposed to trade policies. STMicroelectronics, Synopsys, and Nvidia lead SMH's holdings with the highest projected upside at $385.78 - a 7% potential gain from current levels.