Elon Musk Flags Taiwan as AI’s Weak Link. These Semiconductor ETFs Could Offer a Hedge

FPS Q4 Earnings Beat Estimates on Powertrain Solutions Growth

Forgent Power Solutions (FPS) reported 94% revenue growth in Q4 fiscal 2026 to $462 million, driven by custom products and Powertrain Solutions for data center customers. The company achieved record bookings of $1.50 billion and backlog of $3.02 billion with a 3.3x book-to-bill ratio. FPS projects fiscal 2027 revenues of $2.4-$2.6 billion with 76% growth and is expanding capacity with a $35 million Powertrain Solutions facility investment.

Why Direxion Daily Semiconductor Bull 3X ETF Dropped Today

The Direxion Daily Semiconductor Bull 3X ETF (SOXL) dropped 14.91% after tech leaders Elon Musk, Dario Amodei, and Sam Altman called for a coordinated slowdown in AI development over the weekend. The decline was driven by losses in its top semiconductor holdings, with Micron down 5.1%, AMD down 4.26%, and Nvidia down 2.74%. The author suggests the decline may be temporary as investors reassess whether the AI slowdown will actually be implemented.

Shares of semiconductor and chip-related companies are trading lower after AI executives signaled that the industry's growth may need to be slowed. The industry is also facing pressure as oil prices spike in reaction to the escalating conflict in the Middle East which can lead to inflation, tighter lending and reduced demand.

Reported Earlier, Japan Adjusted Trade Balance -0.84T Vs. -1.00T Est.; -0.68T (Revised) Prior

Reported Earlier, Japan Exports (YoY) For August 19.3% Vs. 18.2% Est.; 23.2% Prior

Reported Earlier, Japan Trade Balance For August -1,105.6B Vs. -1,052.6B Est.; -638.3B (Revised) Prior