Technology stocks are on a wild ride, with the world’s most valuable company swinging between Apple and NVIDIA – volatility driven by an increasing focus on semiconductors.
Bianca Botes, managing director at Citadel Global, says the recent swings suggest volatility in technology stocks is increasingly being driven by factors specific to the sector rather than broader market uncertainty.
“This has been a year for the books. Despite massive geopolitical uncertainty, tech stocks surged over 80% in the first half of 2026. For the past few weeks, however, the sector has been moving violently between positive and negative territory with no clear direction,” says Botes.
Among the swings was Apple overtaking semiconductor company NVIDIA on Friday to become the world’s most valuable company. Investment insight company Motley Fool explains that NVIDIA’s drop of 5% on Friday was the result of more artificial intelligence (AI) model competition from China.
Reuters reports that Apple reclaimed the top spot for the first time since April last year, reflecting what some investors see as a broadening of market interest beyond the companies that have led the AI rally. Apple was valued at about $4.88 trillion, while NVIDIA’s market capitalisation slipped to about $4.86 trillion after its shares fell 3.5%, Reuters says.
This morning, however, NVIDIA was again the world’s most valuable stock, although still below the record $5 trillion it hit last October, valued at $4.912 trillion, data from companiesmarketcap.com shows. Apple is not far behind at $4.901 trillion.
Chips are down
Botes points to the tech-heavy Nasdaq 100, which closed on Friday having recorded daily moves of 1% or more in 18 of the past 26 trading days. She notes that tech stocks are swinging much more than the rest of the stock market.
Yet Daniel Danon and Tobias Knecht, both heads of Volatility Portfolio Management at German asset manager Assenagon, say the “real story sits below the index level”.
They note that the Nasdaq’s implied volatility, which is close to its year-to-date high, is largely being driven by chip stocks.
In its July 2026 Volatility Spotlight, Assenagon says chip stocks – including NVIDIA, Micron, AMD and Intel – have seen their weighting in the Nasdaq 100 grow from around 15% to almost 30% as valuations have risen.
“Semiconductor stock volatilities are doing the heavy lifting. A more concentrated Nasdaq is now exposed to a set of very volatile single names,” Assenagon says. The average one-year implied volatility of semiconductor companies in the index has surged to levels not seen since the 2008 financial crisis, the asset manager says.
Chips with everything
Botes says semiconductor companies “have been both the engine” of the rally in AI stocks in the US “and its most volatile component”. Micron, for example, lost 9% last Wednesday. In May, Reuters reports, it had surpassed $1 trillion.
Botes points to South Korea as an example of how quickly AI optimism can unravel, with heavy selling in Samsung and SK Hynix dragging the country’s technology-heavy KOSPI index sharply lower.
The Philadelphia Semiconductor Index has fallen by about 11% over the past week, highlighting the pressure on chipmakers, says Botes.
While reports of delays to NVIDIA server shipments were the immediate catalyst for semiconductor declines, Botes says investors are increasingly questioning whether spending on AI infrastructure could continue growing at its current pace.
Priced for perfection
Technology shares have also become increasingly sensitive to market sentiment, Botes says. The roughly 30% the Nasdaq 100 gained between late March and early July was concentrated in a handful of companies, leading to minor developments being enough to trigger sharp market swings.
Of the top 10 most valuable companies in the world, only two – Apple and the world’s largest oil producer, Saudi Aramco – were up this morning, companiesmarketcap.com data shows.
“The AI demand story is real. The pricing of that story, in both South Korea and the US, has run well ahead of the earnings evidence,” says Botes. She adds that Warren Buffett said last week that markets are increasingly driven by speculation rather than investing.
*The rand was trading at R16.48 this morning.
Share
