SG Morning Brief | SOX Enters Bear Market, Nasdaq Posts Worst Week in Months

Weekend Wrap

Reuters reported Friday that TSMC asked major suppliers to delay shipments of high-end chipmaking equipment — the first tangible sign that AI capex may be decelerating. Chinese AI startup Moonshot unveiled Kimi K3, which it called the world's most powerful open AI model, intensifying concerns that cheaper alternatives could undercut Western AI infrastructure spending. The SOX has fallen more than 20% from its June record, entering a technical bear market. The US struck bridges and an airport in Iran; Tehran hit a desalination plant in Kuwait. Brent rose 4%+ to its highest in a month.

US Overnight (Friday Close)

The S&P 500 fell 1.01% to 7,457.69, the Nasdaq dropped 1.40% to 25,520.24, and the Dow lost 406.55 points (-0.77%) to 52,146.42. All three posted weekly losses: S&P -1.6%, Nasdaq -2.9%, Dow -0.9%. The SMH semiconductor ETF fell over 4% on Friday alone and roughly 9% for the week — its third weekly decline in four. Applied Materials, Lam Research, Intel, KLA, and ARM each dropped about 4%. Nvidia fell 1.4%, allowing Apple to briefly overtake it as the world's most valuable company. The VIX climbed to 18.03. Despite the chip carnage, the S&P 500 Equal Weight Index is roughly flat over the past month, confirming that the damage remains concentrated in semiconductors rather than the broad market.

Key Movers

Netflix (NFLX) -7% — Netflix fell 7.26% to $68.95 after forecasting Q3 results below Wall Street estimates. The stock had plunged 9% in Thursday's after-hours session but recovered partially at Friday's close. The miss weighed on the communication services sector, which fell 2.4%.

SpaceX (SPCX) -5% — SpaceX fell 5.43% to $123.99, now 8% below its $135 IPO price. The stock has lost over $1 trillion from its post-IPO peak of roughly $2.7 trillion. Short sellers hold nearly a third of the public float.

Dow: Travelers +9% / Coca-Cola -4% — The Dow's divergence was striking. Travelers surged 9.22% to $368.98 on strong earnings, while Coca-Cola fell 3.96% to $81.56, IBM dropped 3.1%, and Goldman Sachs lost 2.7%. The rotation between winners and losers within the Dow continues to drive headline index volatility.

SGX Preview

The STI was near 5,070. DBS near S$62.18, UOB near S$37.91. The SOX entering bear market territory after a 20%+ decline from its peak is a significant negative for Venture Corp and local semiconductor sentiment. However, the equal-weight S&P holding flat suggests the broader economy remains healthy. Oil's 4% surge on Friday is a headwind for Singapore's import costs. This week's ASML and Tesla earnings will test whether the chip correction stabilizes or deepens further.

Asia Pre-Market

Gold closed at $4,017 and silver at $55.70, both bid on safe-haven demand. The VIX at 18 is the highest in over a week. TSMC's reported request to delay equipment shipments is the single most important development for Asian semiconductor names — if confirmed, it suggests the foundry giant is managing capacity more cautiously despite record earnings.

This Week's US Earnings and Economic Calendar

No major data or earnings today (Monday).

Week Ahead Spotlight: ASML (Wednesday) and Tesla (Thursday) — ASML raised 2026 guidance two weeks ago, but the stock has since fallen as the market questions equipment spending sustainability. If ASML confirms strengthening orders, the SOX bear market may find a floor. Tesla reports Thursday — delivery numbers beat but margins remain under pressure from rising battery and memory costs.

One More Thing

The SOX is down 20% from its peak — technically a bear market — but still up 65% year-to-date. The question is whether this is the 2000 kind (SOX fell 80% over two years) or the 2018 kind (fell 25%, then doubled). Every fundamental signal says demand is surging. TSMC asking suppliers to delay equipment is the first crack in that thesis. ASML and Tesla this week will tell us which side is right.

This briefing is for informational purposes only and does not constitute investment advice.