We hit a grand slam in semiconductors. How to trade it from here

Today’s issue in preview:

• We hit a grand slam in semiconductors. How to trade it from here

• You’re not bullish on this booming industry… which means I’m bullish.

• The most important ETF you’re not following sends an important signal

• Our incredible track record gets even better: Our thematic trades in AI Chemicals, Lunar Infrastructure, Biotech, Critical Resources, and Semiconductor continue generating gains

We hit a grand slam in semiconductors. How to trade it from here.

Credit: Ignatiev

Being on the receiving end of the largest investment effort of all-time makes for good business.

Just ask anybody in the semiconductor industry.

Over the past six weeks, the semiconductor industry has enjoyed one of the greatest rallies in stock market history. During this rally, the industry added over $3.7 trillion in market cap.

Since April 1, semiconductor maker Intel (INTC) is up 183%. Fellow semiconductor firm AMD (AMD) is up 123%. Many other semi stocks, including Qualcomm (QCOM), Marvell Technology (MRVL), and ON Semiconductor (ON) have gained more than 50%.

Since the AI boom kicked off in late 2022, a vocal group of people who don’t know much about exponential technologies has loudly predicted the end of a “bubble” they thought had formed.

The “AI is a bubble” group has said big tech’s enormous investment effort in AI is crazy. It won’t generate the revenues and profits required to justify it. Once the world realizes this is the case, GDP growth will stall, and the stock market will crash.

For the past three years, I’ve urged investors to ignore the AI bears and stay long the AI infrastructure megatrend. This advice has proven useful.

The recent strength detailed above has propelled the VanEck Semiconductor ETF (SMH) to a giant 156% return over the past year.

After such a big run, it’s reasonable to ask if the AI-driven semiconductor trend is almost over. My take: Markets are like runners. They can’t sprint flat out for miles. They need to take “breathers.” They need to take breaks. So, it’s reasonable to expect a short-term correction here. That’s how markets work.

But during the correction, keep this in mind: AI is no fad in the same way electricity was no fad, and the automobile was no fad. Instead, AI is the most transformational technology of our time. The world’s smartest and wealthiest technology builders are investing trillions into its progress. Soon, those investments will produce the mind-blowing Agent Supernova. This trend will play out for more than a decade.

The winning strategy here is to ride out the short-term corrections… and stay long the most promising aspects of the semiconductor megatrend. Read here for one of our top ideas.

You’re not bullish on this booming industry… which means I’m bullish.

Credit: Oselote

It’s not getting nearly as much press as semiconductors, but the biotech industry is booming as well. As evidence, I present the 79% one-year gain of the S&P Biotech ETF (XBI) and how it’s a chip shot away from hitting a new multi-year high.

On August 18, I sent a research note to colleagues outlining my bullish view of the biotech sector’s price action. Since then, I’ve written more than a dozen updates on the biotech bull market, as the sector has outpaced the S&P by an incredible 51.7% to 15%.

The biotechnology sector comprises companies working on cures and treatments for hundreds of diseases. When investors grow interested in this industry, the returns can be incredible. During the last biotech bull market, the sector soared 300% over four years.

Biotech performed poorly from 2021 through 2025, so most investors are indifferent to it. But I see major potential here. This industry is poised to generate many stock market doubles and triples over the coming decade.

The fusion of AI plus biology will generate dozens of compelling stock narratives over the coming years. Researchers running superintelligent AI programs will be able to run millions of digital simulations of drugs and treatments. This will put medical innovation into overdrive… and create many big stock market winners.

Companies that leverage AI to “crack the code” for various diseases, treatments and drugs will enjoy 100%… 500%… even 1,000%+ stock rallies.

In many cases, these rallies will happen thanks to stories and potential… rather than a company generating revenue or earnings. Capitalizing on many of today’s biggest stock market trends means focusing on promise over profits. The biotech sector holds the potential for both.

Investors with the time to spend on picking individual biotech stocks and managing the positions can generate large returns in a biotech industry uptrend. For example, over the past year, at least ten companies with “therapeutics” in their names have generated 400%+ returns.

If you don’t want to spend time researching and managing individual biotech stock positions, ETFs can get you exposure to this industry. XBI and the iShares Nasdaq Biotechnology ETF (IBB) – which focuses on giant biotech firms – are worth considering.

The biotech industry has tremendous price momentum working in its favor… plus the investment public is largely indifferent to its success. This is a powerful combination that makes more new highs a high-probability bet.

The most important ETF you’re not following sends an important signal

Credit:Phynart Studio

Over the past month, we have published half a dozen research notes saying that key “real world” economic data suggest the economy is doing much better than most people think.

We’ve detailed how transportation stocks, shopping mall stocks, hotel chain stocks, advertising stocks, diesel engine giant Cummins (CMI), and construction equipment maker Caterpillar (CAT) have reached new one-year highs.

These companies are highly economically sensitive. Their fortunes rise and fall with America’s economic health. And right now, their stocks are soaring. This exceptional price strength means the economy is actually doing very well. Industries involved in making things, transporting things, and buying things are booming.

The stock market is one of the world’s greatest forecasting mechanisms. It tends to look ahead 6-12 months. When an industry is in a recession, its stock prices will rise before the news media says it is recovering. When an industry seems to be doing well, its stock prices will decline before the news covers its downturn. This is often called “discounting the future.”

Let’s add one more real world indictor to your watch list: The share price of the Invesco S&P Small Cap Industrials ETF (PSCI).

PSCI is one of the most important ETFs you’re probably not following. It holds a diversified basket of U.S. manufacturing firms. These companies typically don’t make the front page. There are no “rock star” CEOs like Elon Musk.

These firms operate with little fanfare, providing critical equipment and services the U.S. economy cannot function without. Our factories, vehicles, homes, and cities cannot function without their specialized pumps, motors, filters, valves, gaskets, machines, bearings, and switches. And their businesses are booming.

In late 2025 and early 2026, we frequently highlighted how many critical yet unrecognized U.S. manufacturers were reporting excellent business results and enjoying rising stock prices. At the time, PSCI was regularly registering new all-time highs.

However, PSCI suffered an Epic Fury-induced selloff along with the broad market. Shares dropped 14% in six weeks. But as you can see in the one-year chart below, PSCI has rallied back to its highs and resumed its uptrend.

Yet another “real world” indicator says the economy is doing well… and clearly siding with the Optimists in the big Iran debate playing out in the financial world right now.

Market Notes

• Our March 20th recommendation to own semiconductor equipment stocks is paying off. Lam Research (LRCX) just hit a one-year high. It’s now up 260% in the last year.

• Our recommendation to ignore the AI bears and stay long the AI boom continues to pay off. Leading computer memory players Western Digital (WDC), Sandisk (SNDK) and Seagate Technology Holdings (STX) reached new all-time highs today.

• Our recommendation to own chemical firms leveraged to booming AI infrastructure demand continues to pay off. Element Solutions (ESI) reached a new one-year high today.

• Our October 8th recommendation to own the space theme is still paying off. Rocket Lab (RKLB) and Viasat (VSAT) both hit new all-time highs today. RKLB is up 9% today and 441% over the last year. Plus, our pick to play “lunar infrastructure” – Intuitive Machines (LUNR) reached a new one-year high today. It’s up 51% since our January note.

• Our October 9th recommendation to own the mining sector is paying off. BHP (BHP), Rio Tinto (RIO), Teck Resources (TECK), and Silvercorp Metals (SVM) just hit new yearly highs.

• Fast food giant McDonald’s (MCD) reached a new one-year low today.

• Medical device giants Stryker (SYK) and Boston Scientific (BSX) reached new one-year lows today.

Regards,

Brian Hunt
Editor, Money & Megatrends

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