BAC · News · 20261108N

Semiconductor Market Outlook

BANK OF AMERICA CORP /DE/ · 2026-11-08 · Importance 15 · Surprise 24

Bank of America sees a potential recovery in semiconductor stocks in early 2027, citing improving U.S. policy clarity, corporate buybacks and relatively attractive valuations. It said investors may need to wait for earnings estimate cuts before the sector reaches a durable bottom. The Philadelphia Semiconductor Index had fallen 37% from its recent peak, compared with an average correction of 32% in previous downturns. The bank expects selling driven by concerns about slowing AI capital expenditure could begin to ease by early 2027.

Key facts

• Bank of America sees a potential recovery in semiconductor stocks in early 2027, with improving U.S. policy clarity, corporate buybacks, and relatively attractive valuations helping ease concerns over AI spending; it says earnings estimate cuts may be needed before the sector finds a durable bottom. source
• Bank of America said indiscriminate selling driven by fears of slowing AI capital expenditure could begin to run its course by early 2027, with congressional policy developments and share repurchases helping restore confidence. source