With the hype of artificial intelligence engulfing Wall Street, the massive influx has turned chipmakers trailing from ETFs into the largest companies in their class.
The iShares Semiconductor exchange-traded fund (SOXX ticker) saw an inflow of nearly $805 million Thursday, the most for a single session going back to at least 2001, according to data compiled by Bloomberg. The intake places the fund as the largest fund in the chip space, with $8.8 billion in assets, according to Bloomberg Intelligence, ahead of the VanEck Semiconductor ETF (SMH), with $8.7 billion.
BI analyst Athanasios Psarofagis said, referring to Nvidia Corp. , which set a record this week: “SOXX could be a good AI game thanks to its hefty NVDA weight.” On Thursday, he added, SOXX had its second-highest trading day ever.
The Philadelphia Semiconductor Index of 30 chipmakers rose 13% in two days. A group of ETFs with exposure to Nvidia and Marvell Technology Inc. Also on a boost this week after both companies reported stronger earnings due to their work with artificial intelligence.
The Global X Robotics and Artificial Intelligence ETF (BOTZ), which has a net weight of about 12% of Nvidia, is on track to gain 3% this week, while the VanEck Video Gaming and eSports ETF (ESPO) is on track to add 1.9%. Marvell, on the other hand, makes up more than 5% of the Defiance Next Gen Connectivity ETF (FIVG), and that fund has advanced 4% over five days.
Meanwhile, the GraniteShares 1.5x Long NVDL Daily ETF (NVDL), which tracks 1.5 times the daily performance of Nvidia, jumped 36% this week on above-average volume for its best weekly stretch since its inception.
This week, Nvidia forecast sales that blew past analyst estimates, citing demand for AI processors. The company said sales in the three months ending in July would be about $11 billion, well above analysts’ median estimate of $7.2 billion. Meanwhile, Marvel jumped after saying it expects revenue from its trendy growth engine to rise this year.
Investors have been very focused on AI trends, especially since OpenAI Inc.’s ChatGPT launch. last year. And it could be a boost for the ETF space, too — business intelligence projects and AI-related funds could triple their assets to $35 billion by 2030.
Meanwhile, it was all the talk at industry conferences – the main focus was for ETF managers at the recent Inside ETFs conference in Hollywood, Florida.
“Thematic ETFs representing the future of technology, machine learning and artificial intelligence are definitely experiencing a renaissance,” said Silvia Jablonski, CEO at Defiance ETFs.
– With help from Isabel Lee.