Another Period For The History Books.

Evan Lucas

7/4/2025

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0 min read

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We have deliberately waited a few days before commenting on “Liberation Day” and the fallout that would come from President Trump’s new tariffs regime.It will go down as just another historical period of heightened volatility, uncertainty, risk, and a whole manner of market turmoil. This is why we wanted to put what is happening right now into some context. (If that is possible, considering how volatile the period is and how erratic and how quick the president's manner can change.)US markets have seen this kind of violent move only three times since the 1950s. The S&P’s over 10 per cent drop in the final two sessions of the week following President Trump's "Liberation Day" tariff announcement has it in rare company – and not in a good way - October 1987 (Black Monday), November 2008 (Global Financial Crisis), March 2020 (COVID-19).So, why such a reaction?The market reaction reflects not the ‘shock’ but the scale and brevity of the tariffs. A 10% across-the-board tariff was broadly expected. There were some calculations as much as 15 to 20% judging by the net $1 trillion in and out of the federal government revenue. (This is the impact of DOGE and other government spending cuts coupled with the tariffs now in place that will offset the promised 0% personal income tax for those earning up to US$150,000)But what markets didn’t see coming was the country-specific layer. Take China as an example; the additional 34% reciprocal tariff on Chinese goods pushed the total to 54%. With other measures factored in, the effective burden could approach 65%.Then there were the tariffs that were tied to trade deficits, hitting Japan, South Korea and most emerging markets between the eyes (i.e. Vietnam).The EU saw a 20% rate, which was within expectations, while the UK, Australia, New Zealand and others landed at 10%. Canada and Mexico were spared, as was Russia, North Korea and Belarus, interestingly enough.Energy was excluded, which is unsurprising considering Trump’s goal of getting energy down, down and staying down. Pharmaceuticals and semiconductors were also carved out, however, this is more down to the probability of more targeted action like that of steel and aluminium.Now, what is different about this market shock and risk off trading is that it would send funds flowing to the US dollar, ratcheting it higher. But not this time. The dollar weakened against the euro. Theories as to why range from Europe’s lighter tariff load to euro-based investors pulling money out of the US. The same could be said of the Swiss Franc.All this leads to an average effective tariff rate of around 22%. That number will likely climb once product-specific tariffs on areas like pharmaceuticals and lumber are formalised. Some of this may be negotiated down, but not soon, and the possibility of tit-for-tat retaliation like China has now entered into could actually see it going higher still as the President looks to outdo country responses.The broader uncertainty this introduces to the US outlook is now at its highest since early 2020 and has the markets pricing in 110 basis points of Fed rate cuts this year – a near 5 cut call shows just how unprecedented this is.In fact, in no time in living memory has a developed economy lifted trade barriers this aggressively or abruptly. What has been implemented is textbook economics 101 supply-side shock.Input costs go up, finished goods get pricier, and the ripple effects hit margins and employment. Expect to see this in the next six months.Expect core PCE inflation to finish the year at 3.5% —nearly a full percentage point higher than the consensus forecast from just a week ago.Real GDP growth is forecast to slow to 0.1% on a quarter-on-quarter basis. That path may be volatile as Q1 could look worse due to soft consumption and strong imports, with a mechanical bounce in Q2.What has been lost in the chaos of last Thursday and Friday’s trade was the March Non-farm payrolls jobs print came in at 228,000, which was above consensus, the caveat being it is less so after downward revisions to prior months.Hospitality hiring was strong, likely helped by a weather rebound that won’t repeat. Government payrolls are holding steady for now, but cuts are coming. Layoffs in defence and aerospace (DOGE) are already underway, and tariffs will act as a brake on new hiring. Expect softer reports ahead.Unemployment ticked up slightly to 4.15%, reflecting a modest rise in participation. That’s still within range, giving the Fed cover to hold off on immediate action. But if job losses build pressure on the Fed to act, it will increase quickly.The consensus now is for the first rate cut of this cycle to start in May, triggered by softer April payrolls and earlier signs of deterioration in jobless claims and business sentiment.Zooming out from just a US-centric point of view, the macro standpoint is just as bad if not worse. The scale of tariffs adds pressure on industrial production, trade volumes and cross-border investment.That’s feeding into commodity markets, where the outlook has turned more cautious.Brent is expected to fall into the low US$60s as trade frictions and oversupply build. LNG looks weaker too, with soft Asian demand and less urgency in Europe to restock. Iron ore is more exposed to China, and the reciprocal tariffs put a vulnerability into the price due to the broader global slowdown and higher prices to the US.Looking at China specifically, infrastructure remains a key policy lever that would offset the possible loss of demand in aluminium, copper, and steel. Monetary indicators are beginning to turn, suggesting the start of a new easing cycle. It also suggests that policy remains inward-facing, and a focus on domestic stability would mean a metals-heavy growth path. Thus suggesting Australia could be the ‘lucky country’ once more and could escape the full burden of the global upheaval.In short, the global reaction isn’t just about tariffs. It’s about what happens when policy shocks collide with already-fragile global demand, and central banks are forced to navigate inflation that’s driven by politics, not just price cycles.This is the question for traders and investors alike over the coming period.

Evan Lucas

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The tariff impact: The US margin problem vs Asia’s volume problem

Tariffs do not hit every company the same way. For US retailers and consumer brands, the first pressure point is usually margin.

GO Markets

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May 25, 2026

Federal Budget 2026-27: What traders should watch

Tuesday, 12 May 2026, at roughly 7:30 pm AEST, Treasurer Jim Chalmers will stand up in Canberra and deliver the 2026-27 Federal Budget. According to Budget.gov.au, that is when the Budget is officially released, with the Budget papers going live online at the same time.

GO Markets

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May 10, 2026

5月份美国市场驱动力：消费者价格指数、就业人数和石油冲击

GO Markets

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April 28, 2026

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Recent Articles

What are bond yields and what do they do?

Part two of GO's educational series, designed to help new traders understand the key forces that shape global markets.

Every day, traders watch gold, tech stocks and the Australian dollar move, looking for the next catalyst. But behind many major market moves sits another force that can shape direction: bond yields.

Many traders treat bonds as something only institutional investors need to follow. That can leave a major part of the market story out. When yields move, the effect can flow into markets far beyond bonds.

Why bond yields matter

Bond yields are one of the market’s main signals for the cost of money. When yields rise or fall, they can influence currencies, equities, gold and risk appetite because they change how investors value future returns.

Contents: What it is · Price vs yield · Two key yields · What moves yields · Three scenarios · Market impact · When to watch · Test your knowledge

What bond yields actually are

At its most basic level, a government bond is a loan from investors to a government.

When an investor buys a bond, they are lending money to that government for a fixed period. In return, the government agrees to pay a fixed amount of interest each year until the bond matures and the original money is returned.

You do not need to trade bonds to understand why they matter. What matters is not only the bond itself, but the return on that bond. That return is called the yield, and it can tell traders how the market is pricing inflation, growth, central bank policy and risk.

When commentators say “yields are rising” or “the yield curve has shifted”, they are usually talking about government bond yields.

The Lifecycle of a Government Bond

The Loan

An investor buys a bond, effectively lending capital to the government for a fixed period.

The Interest

The government agrees to pay a fixed, recurring amount of interest every year.

Maturity

The bond's term ends, and the government returns the original money to the investor.

The Yield

The actual return an investor makes on this process. It acts as a live market signal for inflation, growth, Fed policy, and risk.

Why bond prices and yields move in opposite directions

This is one of the key concepts to understand: bond prices and bond yields move in opposite directions. When bond prices rise, yields fall. When bond prices fall, yields rise.

It can feel counterintuitive at first, but the mechanism is straightforward once the coupon payment is fixed.

How does it work?

Let’s say an investor buys a new government bond for US$100, and it pays a fixed US$5 interest payment every year. The yield on that investment is 5%.

Now imagine the economy slows and investors seek the perceived safety of government bonds. Demand increases, which pushes the price of the bond up to US$110 in the open market. The government is still only paying that same fixed US$5 a year. If a new investor buys the bond at US$110, the yield on that US$5 payment falls to about 4.5%.

The price went up, but the yield went down.

Conversely, if investors sell bonds to buy riskier assets, the price of the bond may drop to US$90. That same fixed US$5 payment now represents a higher yield of about 5.5%.

The price went down, but the yield went up.

INTERACTIVE PRICE vs YIELD SIMULATOR

Drag the slider to see how market demand mathematically shifts the yield.

Fixed Payout $5.00

Market Price $100

Current Yield 5.00%

Mass Sell-off ($80) Panic Buying ($120)

MARKET STATUS: PAR VALUE (Baseline)

Two key Treasury yields traders often watch

Traders do not need to follow the entire bond market. Two US government bond yields often receive the most attention because they send different signals.

The US 2-year Treasury yield reflects the market’s near-term expectations for central bank policy. Because it matures in two years, it is highly sensitive to what traders believe the Federal Reserve may do with interest rates at upcoming meetings.

The US 10-year Treasury yield reflects the market’s view of longer-term economic growth, inflation and risk appetite. It is the benchmark borrowing rate for the global economy. When commentators say “yields are rising”, they are often referring to the 10-year yield.

The difference between yields across maturities is known as the yield curve. A changing yield curve can suggest shifts in expectations for growth, inflation and monetary policy.

What moves bond yields

Bond yields do not move in a vacuum. They respond to macroeconomic data, central bank signals, investor positioning and risk sentiment.

Understanding which force is currently driving the move can help traders avoid reacting only to the headline and start reading the context behind it.

What moves bond yields

Inflation expectations

Higher yields driven by inflation can weigh on gold, growth stocks and rate-sensitive assets.

↓ tap to expand

When inflation rises, or is expected to rise, investors may demand higher returns to compensate for the loss of purchasing power.

Yields may rise

When inflation data surprises to the upside or when markets expect central banks to keep rates higher for longer.

Yields may fall

When inflation cools, rate expectations ease or investors believe the inflation threat is becoming less persistent.

Fed and central bank policy

Fed expectations are one of the most important drivers of the 2-year yield and can flow directly into currency pairs, gold and equity indices.

↓ tap to expand

Central bank expectations are especially important for shorter-dated yields. The US 2-year Treasury yield often moves sharply when markets reprice the likely path of Federal Reserve policy.

Yields may rise

When the Fed signals rate hikes, delayed cuts or a higher-for-longer policy stance.

Yields may fall

When the Fed signals a possible pivot, slower inflation or weaker growth.

Economic growth outlook

The 10-year yield is often watched as a signal of long-run growth, inflation and market confidence.

↓ tap to expand

The 10-year yield is heavily influenced by the market’s view of long-term growth.

Yields may rise

When growth is strong and investors move from bonds into risk assets, pushing bond prices lower.

Yields may fall

When growth slows, recession fears rise or investors seek the perceived safety of government bonds.

Risk sentiment and safe-haven demand

Yield moves during stress periods can reflect positioning, liquidity and safe-haven demand, not just fundamentals.

↓ tap to expand

During periods of stress, bond yields can move in ways that appear to contradict the economic data.

Yields may rise

In a risk-on environment, investors may sell bonds and move into equities or other risk assets. That can push bond prices lower.

Yields may fall

In a risk-off environment, investors may buy government bonds for perceived safety. That can push bond prices higher.

Watch this, not just that

Do not just watch whether yields are rising or falling. Watch what is driving the move.

A yield rise driven by strong growth can carry a different message from a yield rise driven by sticky inflation. A yield fall caused by cooling inflation can also mean something different from a yield fall caused by panic buying during a market shock.

Three common bond yield scenarios to recognise

The scenarios below map a simple chain: macro catalyst, yield mechanism and potential asset impact.

Macro Catalyst

Inflation surprise

CPI or inflation data comes in hotter than expected.

Yield Mechanism

Yields rise

Markets price higher rates or longer restrictive policy

Asset Impact

Growth equities ↓ Safe havens ↓ USD pairs ↑

Macro Catalyst

Growth scare

Weak labour market data or rising recession concerns.

Yield Mechanism

Yields fall

Investors buy bonds for perceived safety

Asset Impact

Broad equities ↓ Safe havens ↑ Commodity FX ↓

Macro Catalyst

Fed repricing

Fed decision or data shifts future rate expectations.

Yield Mechanism

2-yr moves quickly

Highly sensitive to near-term policy

Asset Impact

Rate-sensitive assets ↕ USD pairs ↕ Commodity FX ↕

Common trap

Assuming a move in yields means the same thing every time.

The mistake is treating yields as a simple directional signal.

They are better read as a context signal. The same yield move can affect markets differently depending on whether it is driven by inflation, growth, Fed policy or risk sentiment.

How yields may affect markets you trade

Once traders understand what yields are and why they move, they can map the potential impact across their trading screens.

1. Gold (XAU/USD)
Gold tends to move inversely with real yields, which are nominal yields adjusted for inflation. When real yields fall, gold may become more attractive because the opportunity cost of holding a zero-yield asset decreases. When real yields rise, gold can come under pressure because interest-bearing assets may become relatively more attractive.

2. Tech and growth stocks
Higher yields increase the discount rate applied to future earnings. This can weigh on growth stocks because much of their expected value is tied to earnings that may arrive years from now. That is one reason the Nasdaq 100 is often described as rate-sensitive.

3. US dollar
Higher US yields can attract foreign capital seeking better returns. That can increase demand for the US dollar, particularly when US yields are rising faster than yields in other major economies.

4. AUD/USD
AUD/USD is sensitive to the interest rate differential between the Reserve Bank of Australia and the Federal Reserve. When US yields rise faster than Australian yields, the rate differential may favour the US dollar and weigh on AUD/USD.

Gold · XAU/USD

May weaken if real yields rise

↓

Tech & Growth

Valuation pressure increases

↓

US Dollar

May strengthen on yield gap

↑

AUD/USD

Rate differential favours USD

↓

Typical directional impacts when US yields rise. Tendencies, not guarantees.

When yields may deserve closer attention

Bond yields do not need to be monitored every minute. However, there are specific windows when yield moves may have a stronger influence on market pricing.

CPI releases: CPI can matter because it can quickly reprice expectations for inflation, real yields and Fed policy.
Federal Reserve meetings: Fed decisions, press conferences and forward guidance can directly reprice the short end of the yield curve.
Non-Farm Payrolls and jobs data: Strong employment can reduce expectations for near-term rate cuts. Weak jobs data can increase expectations for Fed easing. Both move USD significantly.
Major risk-off events: Geopolitical shocks, banking stress or sharp equity sell-offs can trigger sudden demand for perceived safe-haven assets, including US government bonds. In these periods, yields may fall quickly as bond prices rise, even if the underlying inflation backdrop has not changed.

Test your knowledge

1 / 12

0 correct

0 wrong

Concept Check

How sure are you?

Your call

Questions Correct

Round Review

Key takeaway

The US dollar is not just another market input. It is one of the main reference points global markets keep coming back to.

The Editorial Desk

•

June 10, 2026

When Nvidia's Jensen Huang speaks, Asia moves: AI infrastructure stocks to watch

What are the five Asian tech and infrastructure stocks linked to the AI buildout?

Market Intelligence Insights | GO Markets

Jensen Huang stood on stage at GTC 2026 and projected US$1 trillion in cumulative AI hardware revenue through 2027, spanning the current Blackwell generation and the newly announced Vera Rubin architecture. That is not just a corporate forecast. It is a gravitational pull reshaping parts of the global technology sector.

In market circles, this effect is often linked to Huang's ability to move sentiment across AI-related stocks.

Here is the part that many retail investors can miss: NVIDIA is a fabless chip designer. It conceives the architecture and writes the code, but manufactures none of the actual silicon. Every dollar of that US$1 trillion projection would need to flow through a highly concentrated manufacturing pathway, and that route runs directly through Asia.

For APAC traders, the headline rally in New York is only half the story. The broader opportunity sits inside the Asian technology giants linked to the hardware supercycle: the companies making the parts, infrastructure and capacity without which none of this works.

Table of Contents

↓ Why the hardware stack matters ↓ Five stocks across the AI infrastructure chain ↓ The macro date to watch: 16 June 2026

Why the hardware stack matters

The largest passive exchange traded funds (ETFs) in the world are moving through a highly concentrated market structure. According to Morningstar Direct and Trivariate Research data, approximately 31.3% of the S&P 500 is now concentrated in just seven stocks. When too many dollars chase too few names, diversification can become less reliable and valuation multiples are more exposed.

US tech giants

High concentration longs

Seven stocks. 31.3% of the S&P 500. When positioning is this crowded, even a beat can fail to move the stock. The multiple is already doing the work the earnings should do.

→ Valuation multiple risk

APAC enablers

Uncrowded physical plays

Memory in Seoul. Foundries in Hsinchu. Power grids in Tokyo. These stocks do not need multiple expansion to perform. They need NVIDIA to keep shipping.

→ Pure-play volume capture

The APAC enablers tell a different story. They are less crowded than the US mega-cap AI trade, central to the buildout and driven more by volume capture than multiple expansion.

Where each stock sits in the stack

Layer 01

Memory Subsystem: Samsung & SK Hynix

Supplies high-bandwidth memory (HBM4) optimized for modern accelerator architectures.

Layer 02

Physical Fabrication: TSMC Foundry

Manages pure-play silicon wafer etching and critical advanced CoWoS packaging.

Layer 03

Architecture Core: NVIDIA (Fabless)

Conceives system logic blueprints (Blackwell/Vera Rubin platform architecture).

Layer 04

Deployment & Utilities: Alibaba Cloud & Hitachi

Operates localized ASIC data centre clusters and updates grid power infrastructure.

The thesis is direct: identify the companies supplying the raw materials, components and infrastructure, regardless of which AI model ultimately wins the commercial software race.

Five stocks across the AI infrastructure chain

Value Chain Stack Architecture // Individual Operators

01 TSMC 2330.TW

Taiwan Core Foundry

Taiwan Semiconductor Manufacturing Company is the foundry that makes the most advanced processors used across NVIDIA's AI accelerator roadmap. There is no credible alternative at scale for the cutting-edge chips the industry currently requires. That gives TSMC significant strategic relevance in this cycle.

For Q1 2026, the company posted revenue of US$35.9 billion, up more than 40% year-on-year, with a gross margin of 66.2%. High-performance computing (HPC), including AI-related revenue, accounted for about 61% of Q1 revenue.

Q1 2026 RevUS$35.9B

Gross Margin66.2%

HPC Segment61%

Watchpoint: CoWoS packaging capacity is still the constraint to watch. Recent supply-chain estimates from TrendForce and Silicon Analysts indicate that TSMC's CoWoS lines are fully booked, with lead times stretching as far as 104 weeks and capacity meeting only around 80% of aggregate demand. The question is whether TSMC's committed US$52 billion to US$56 billion capital expenditure (capex) for 2026 helps close the gap before demand moves further ahead of capacity.

02 Samsung Electronics 005930.KS

South Korea Memory

Samsung sits one layer above the processing core in the AI chip stack, supplying the high-bandwidth memory (HBM) that helps advanced processors operate at the speeds artificial intelligence workloads demand.

Samsung says its sixth-generation HBM4 is now in mass production and designed for the Vera Rubin platform. That places Samsung inside the next phase of AI infrastructure demand, alongside other HBM suppliers competing for allocation across advanced systems.

Watchpoint: Global tariff headwinds and domestic labour negotiations are the main operational risks to monitor, alongside profitability metrics in Samsung's semiconductor division.

03 SK Hynix 000660.KS

South Korea Memory

SK Hynix pioneered earlier generations of HBM architecture and remains deeply integrated into the NVIDIA value chain. That relationship is visible in upstream data: FormFactor reported SK Hynix accounted for 29.5% of its Q1 2026 revenue, with NVIDIA accounting for another 10.2%.

SK Hynix is also reportedly evaluating whether its memory products can work with Intel's packaging technology. That move reads as a potential hedge against TSMC's constrained CoWoS capacity.

Watchpoint: Geographic concentration is a real pressure point. Any escalation in regional geopolitical tensions would feed directly into this heavily centralised component ecosystem.

04 Alibaba Group BABA / 9988.HK

China Cloud Infrastructure

While the semiconductor companies capture the manufacturing layer, Alibaba represents the enterprise adoption layer. China's 15th Five-Year Plan for 2026 to 2030 places significant emphasis on an "AI plus" initiative and technology self-reliance.

Alibaba gives investors exposure to China's domestic AI infrastructure push, including customised computing clusters using locally designed application-specific integrated circuits (ASICs) as an alternative to Western-restricted hardware.

Watchpoint: The pressure is margin support. Markets are watching whether consumer-facing revenue can recover strongly enough to support the cloud division while capital-intensive infrastructure spending remains elevated.

05 Hitachi 6501.T

Japan Grid Infrastructure

Hitachi is not a chip company. It is an industrial conglomerate with deep expertise in factory automation and power grid infrastructure. AI data centres consume enormous amounts of electricity, which can place serious pressure on power networks.

Hitachi recently announced a major collaboration with Intel covering factory automation, energy infrastructure and custom chip design. Hitachi links the digital AI story with the infrastructure layer in Japan, where grid investment, automation and industrial efficiency are becoming part of the same conversation.

Watchpoint: Japanese manufacturers still face margin pressure from elevated domestic energy costs. Material cost inflation also remains a drag on industrial margins.

Macro Matrix Catalyst

16 June 2026

The APAC Central Bank Double-Header

This is the main macro date APAC tech traders need to watch.

Reserve Bank of Australia

4.35% Base

Hold Expected

A hawkish hold is expected as policymakers weigh energy-driven inflation. The RBA's posture is likely to remain important for the yield floor in Australian dollar carry trades.

Bank of Japan

1.00% Projected

66% Hike Prob.

Markets are pricing a 66% probability of a move to 1.00% as policymakers weigh yen weakness and the risk of a disorderly breach of the 160.00 level.

Bottom Line

Do not just watch the green candles in New York. The broader AI infrastructure story runs through memory in Seoul, foundries in Hsinchu and power grids in Tokyo. For traders, the task is to understand which parts of the hardware stack are most exposed before the next macro catalyst arrives. On 16 June, central bank decisions in Australia and Japan could shift the backdrop for APAC technology names.

The Editorial Desk

•

June 10, 2026

Intel’s AI chip shock: Is TSMC’s manufacturing moat starting to crack?

Intel’s reported Google TPU order has injected fresh drama into the AI chip race.

Intel, TSMC and the AI Chip Squeeze | GO Markets Insights

For most of the artificial intelligence (AI) boom, the market has treated Taiwan Semiconductor Manufacturing Company (TSMC) as the toll road everyone had to use. Nvidia, Apple, AMD, Broadcom and many major AI chip players relied on its manufacturing capacity.

Now that story is getting more complicated.

Intel reportedly jumped more than 11% on Monday, 8 June 2026, after reports that Google had placed an order for more than 3 million custom tensor processing units (TPUs) with Intel Foundry for delivery from 2028.

That does not make Intel the new TSMC. It does suggest the market is asking a sharper question: what happens when the AI boom starts running into capacity limits?

Table of Contents

↓ Here’s the setup ↓ Why packaging is the bottleneck ↓ Why the market cares ↓ Assets and names to watch ↓ Bull case, cautionary case and what could go wrong

Here’s the setup

Demand for leading-edge wafers and advanced packaging has grown faster than the supply chain can comfortably absorb. That pressure is now forcing major AI customers to consider alternatives, not necessarily because they are abandoning TSMC, but because they may need more than one route to production.

One answer that emerged on Monday was Intel.

Google has reportedly placed an order with Intel to manufacture more than three million in-house tensor processing units in 2028. Nvidia is also reportedly evaluating Intel’s advanced packaging and 18A process for future chips, according to The Information, which cited people with direct knowledge of the talks.

Why Intel moved

Intel shares rose roughly 11% on Monday, closing at US$110.27. The move added to a sharp 2026 rally and signalled that investors may be reassessing Intel’s role in the AI supply chain.

“The AI boom appears to be testing the physical limits of capacity in Taiwan. Intel may be one of the few US companies with infrastructure that could absorb part of the overflow.”

Why packaging is the bottleneck

To understand why Monday's news mattered so much, it helps to understand one often-overlooked part of chipmaking: advanced packaging.

Building an AI chip is not just about making the chip itself. Manufacturers also need to connect the processor, memory and other components together so they can work as a single system. That final assembly step is known as advanced packaging.

TSMC dominates one of the most important packaging technologies, called CoWoS (Chip on Wafer on Substrate). The challenge is that demand for CoWoS has surged alongside the AI boom.

Nvidia alone is expected to account for about 60% of global CoWoS demand in 2026, while Broadcom and AMD are expected to take another 26%. That leaves relatively little capacity available for smaller AI chip developers and custom chip makers.

CoWoS

2026 Demand

Projected Advanced Packaging Demand

Nvidia 60%

Broadcom & AMD 26%

Other Developers / ASICs 14%

Projected CoWoS demand concentration in 2026. Nvidia, Broadcom and AMD are expected to absorb most available advanced packaging capacity, leaving a smaller share for other developers and ASIC vendors. Figures are illustrative and based on reported industry estimates.

In simple terms, demand for AI chips is growing so quickly that one of the industry's key manufacturing steps is becoming a bottleneck.

Where Intel may fit

Intel has been developing its own alternative packaging technology, called EMIB, or Embedded Multi-die Interconnect Bridge. The technical details are complex, but the market point is simple: Intel believes EMIB can support large AI chip designs and may become an alternative to TSMC’s CoWoS for some workloads.

Intel’s EMIB has reportedly gained traction at Google and Meta, with production yields said to reach around 90%. Yield refers to the percentage of chips that come off the production line working properly. Higher yields generally mean lower costs and more reliable manufacturing.

The geopolitical angle also matters. Some chips made at TSMC’s Arizona facility may still need advanced packaging in Taiwan before final delivery. That weakens the idea of a fully onshore supply chain and helps explain why US-based packaging capacity is getting more attention.

Fabrication

Dies etched at TSMC facility in Arizona, USA.

→

Transit

Partly completed chips shipped over the Pacific.

→

Assembly

Advanced packaging applied back in Taiwan.

→

Distribution

Finished hardware distributed to end markets.

This packaging dependency complicates the local assembly objective behind the US onshore framework.

The extended fabrication and packaging loop. Chips fabricated in Arizona may still require advanced packaging in Taiwan before final distribution, highlighting a potential supply chain vulnerability.

Why the market cares

The Intel story is not just about one company winning a contract. It is a signal about where the AI supply chain may be heading.

When Google, one of TSMC’s key customers, reportedly tests a competitor’s packaging technology and then places a multi-million-unit order, the market hears several things at once: TSMC’s capacity constraints may be pushing customers toward alternatives, Intel’s technology may be gaining credibility, and the old “Intel is too far behind to matter” narrative may need updating.

Intel has gained approximately 422% over the past 12 months, an unusually large move for a large-cap semiconductor stock. For traders, the transmission effect is broader than Intel alone. A stronger Intel foundry story may attract capital into US semiconductor names and create a relative value debate between Intel and TSMC, not because TSMC is in trouble, but because its near-monopoly premium is being reassessed.

INTC vs TSM, relative performance in 2026

Year to date (YTD) performance to 9 June 2026. Figures are approximate and provided for illustrative market context.

~+175%

INTC

Intel Corp

~-30%

TSM

TSMC

~-60%

NVDA

NVIDIA

~-25%

SOX

PHLX Semi

Assets and names to watch

A structural shift in foundry dynamics ripples outward across key technology components. Monitor this streamlined breakdown to scan positioning profiles.

Name	Why it matters	What to watch
Intel Corporation	US foundry challenger. The reported Google TPU order and Nvidia trials support the second-source story, but foundry losses and execution risk remain the key limits.	Google order final confirmation, 18A process yields, structural foundry unit losses.
TSMC	Still the dominant global foundry. The risk is not immediate share loss, but that capacity limits create space for alternatives to gain relevance.	CoWoS advanced packaging expansion timelines, gross margins, key customer retention.
NVIDIA	The demand engine behind much of the AI supply chain pressure. Its Intel trials matter, but testing does not equal a production shift.	Whether multi-project wafer trials translate into high-volume commercial production orders.
SMH ETF	Broad semiconductor exposure through a basket containing TSMC, NVIDIA and Intel.	Useful for tracking whether the story is stock-specific or sector-wide.

Bull case, cautionary case and what could go wrong

The supportive case for Intel is easy to understand. AI demand remains strong, TSMC capacity stays tight and major customers are looking for credible second-source manufacturing options. If Intel can turn reported trials and early customer interest into commercial production, the market may continue to treat its foundry strategy as more credible.

But this is still a conditional story, not a completed turnaround.

Intel’s foundry unit posted an operating loss of approximately US$10.3 billion in fiscal 2025, while the stock has already rallied about 175% year to date (YTD). That leaves less room for disappointment if future updates fall short.

The biggest technical test is 18A. Intel needs its manufacturing process to reach yields that commercial customers can rely on. Yield refers to the share of chips that come out usable. If Q2 disclosures disappoint, confidence in the foundry story could weaken.

Customer confirmation also matters. NVIDIA has not placed a production order with Intel. Reported Feynman architecture trials are still early stage, and testing does not guarantee committed production volume.

TSMC is another constraint on the Intel bull case. It is targeting CoWoS capacity of approximately 130,000 to 140,000 wafers per month by 2026 to 2027. If that expansion catches up with demand, the pressure pushing customers toward alternatives may ease.

There is also the broader AI spending cycle. If hyperscalers such as Google, Microsoft, Amazon and Meta slow infrastructure spending, the whole semiconductor sector could come under pressure, regardless of Intel’s progress.

The key variables to watch are customer confirmation, 18A yield progress, Intel foundry pipeline updates, TSMC capacity expansion and whether AI infrastructure spending remains strong.

Key takeaway

The semiconductor space is no longer just about raw processor speeds, it has become an execution battleground for advanced packaging capacity and global footprint resilience.

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The Editorial Desk

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June 10, 2026

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