SOXX

Shares of semiconductor producers, which I particularly value as the most important part of my investment strategy, have gained a fresh upside momentum and climbed up once again on reports from the SIA (Semiconductor Industry Association) that chip sales exceeded their normal seasonal dynamics in March. Therefore, Broadcom Inc (AVGO) stock price increased by 2.52%, Advanced Micro Devices (AMD) rose by 3.44%, NVidia (NVDA) rose by 3.77% and Micron Technology (MU) added 4.73% to its market price on Monday, May 6.

SIA is a trade association, or to be more precise is a powerful lobbying group and a voice of the American semiconductor industry, yet it used to calculate its sales number carefully. This time it said the amount reached $50.8 billion in the U.S., meaning a solid 16.4% MoM surplus. Preliminary estimates of analysts at a reputable Citigroup, for example, pointed to $50.1 billion keeping its whole year chip sales forecast at 11%, even though its brokerage division represents a rather bullish camp on the issue. In combination with some insights from analog companies this may support a better prospect of planning inventory replenishment in the second half of 2024, Citi supposed in a client's note. Analog and microcontroller units faced a remarkable growth by nearly 50%, which is much higher compared to the average 20%, which would be typical for the very beginning of spring season.

This makes me even more optimistic to not be in a hurry or rush with fixing profit ahead of this new wave of the chip fever before summertime. So, a well-known traders' proverb "Sell in May and go away" could easily be converted into a "Buy and Hold in May and go away" sentence, in my humble opinion, especially as the S&P 500 also continues to recover after its recent price adjustment stage in April. The PHLX Semiconductor Sector's ETF (SOXX) on NASDAQ added 2.08% the same day, bouncing from a dip at 198.4 on April 19 to 220.6 at the moment (11.2% for about a couple of weeks) to reach more than 55% of a return in the recent 12 months. A successful assault on the heights above 240 is on the nearest agenda, with expectations of new record prices for leading chip stocks as the basic scenario.