Key facts
- The Philadelphia Semiconductor Index is on pace for its best quarter ever.
- Chip stocks have gained 69% in the past two months.
- The semiconductor sector is the best performing in the S&P 500 this year.
- Geopolitical developments are cited as a key driver for the rally.
- A legal battle involving AI firm Anthropic could lead to a broader AI buildout.
Chip stocks have seen a significant rally, with the Philadelphia Semiconductor Index experiencing its best quarter on record after soaring 69% in the past two months. This surge makes semiconductors the top-performing sector in the S&P 500 this year, with many chipmakers now among the benchmark's leading stocks. The rally is attributed to two major geopolitical developments: improving prospects for peace in Iran, which is boosting riskier assets, and a legal dispute involving AI firm Anthropic and the U.S. government, which could potentially lead to a wider buildout of AI infrastructure.