AI Mania Drives Strong First-Half Gains for US Stocks, but Fundamentals Take Center Stage in H2
The AI boom powered US equities to impressive gains in the first half of the year. As the second half begins, however, the market’s focus is shifting from chasing growth stories to scrutinizing corporate fundamentals. Chip stocks have come under selling pressure as investors lock in profits, while the Federal Reserve’s renewed commitment to fighting inflation has made market sentiment more cautious. At the same time, several prominent investors have sounded the alarm about historically high US stock valuations, warning against overconcentration in a single market or tech sector. In this increasingly volatile environment, building a diversified asset allocation strategy is more important than ever.
A Rocky Start for US Stocks in H2: Chip Stocks Hit Hard by Profit-Taking
(Source: TradingView)
On the first trading day of the second half of 2026, all major US stock indices closed in the red, signaling a clear cooling in market sentiment. After a strong rally fueled by AI themes in the first half, semiconductor stocks were the first to see a marked correction, dragging down both the Nasdaq and the Philadelphia Semiconductor Index. Notably, shares of Micron and Sandisk each fell by more than 10% in a single day, reflecting a wave of profit-taking after substantial gains. According to market data, semiconductor stocks surged over 80% in the first half of the year, but as the new quarter begins, short-term selling pressure has emerged.
Meanwhile, Federal Reserve Chair Kevin Warsh stated at the European Central Bank Forum that US inflation remains above target, and the Fed is still committed to bringing inflation back to 2%. However, he provided no further guidance on future interest rate policy, leaving markets focused on whether the high-rate environment will persist.
AI Remains Hot, but Tech Stocks Begin to Diverge
Despite the weak performance in semiconductors, not all AI-related stocks declined. Meta, for example, soared 8.8% in a single day after reports that it would expand into cloud services and sell excess AI computing power. This shows that investors are still willing to back companies with new growth stories. The main takeaway: the AI investment narrative hasn’t disappeared, but the market is increasingly focused on whether companies can deliver sustained revenue and profit growth, rather than relying solely on hype to drive valuations. Going forward, tech stock performance will depend more on actual earnings and the ability to commercialize AI, rather than just market sentiment.
Jeremy Grantham Issues Another Warning: US Stock Valuations May Be in the Biggest Bubble Ever
Beyond short-term corrections, legendary investor Jeremy Grantham has reignited debate with another warning. The GMO co-founder, who famously predicted both the dot-com bubble and the 2008 financial crisis, now says US equities are among the most overvalued in history—even surpassing the levels seen during the dot-com era in 2000.
Grantham believes that if the market reverts to its long-term average valuation, US stocks could see corrections of up to 70%. He particularly warns that the greatest risk isn’t the overall market, but the extreme concentration of capital in a handful of large tech names. While AI leaders like NVIDIA have delivered stellar returns, history shows that the biggest winners in bull markets often suffer the steepest declines in bear markets.
Ray Dalio: Investors Should Prioritize Asset Allocation
Bridgewater Associates founder Ray Dalio has echoed similar concerns, noting that US stock valuations are now near levels seen before the 2000 dot-com bubble and the 1929 Great Depression. Still, many market observers point out that high valuations don’t necessarily mean an immediate reversal—market sentiment can remain elevated for extended periods.
Therefore, rather than trying to time the market top, what matters most is:
- Avoid concentrating assets in a single market
- Diversify across industries and geographies
- Maintain disciplined, long-term investing
- Manage overall portfolio risk
This is why global asset allocation has become an increasingly important focus in recent years.
Global Diversification: Opportunities Beyond US Stocks
AI innovation is no longer confined to the US. In addition to American tech giants, South Korea boasts a critical role in the global semiconductor supply chain, with companies like Samsung Electronics and SK Hynix. Hong Kong is home to major tech firms such as Tencent, Meituan, and Xiaomi. Meanwhile, sectors like renewable energy, smart manufacturing, and biotech are emerging as key investment themes in Asian markets. As a result, more investors are diversifying globally rather than betting solely on US stocks, reducing the impact of volatility in any single market.
Gate Stocks Officially Launches: Building a Global Stock Investment Platform
To meet the growing demand for global asset allocation, Gate has officially launched its stock trading service. In addition to the app, a web version is now available, making it even easier for investors to access global stock markets. Gate Stocks now supports trading in over 12,500 stocks and ETFs, including more than 10,000 US stocks and ETFs, over 1,500 Hong Kong stocks, and the top 1,000 companies by market cap on the Korea Exchange (KRX). From AI and semiconductors to finance, consumer, renewable energy, and smart manufacturing, investors can build diversified portfolios on a single platform.
Trade Global Stocks with USDT: Lowering the Investment Barrier
One of the standout features of Gate Stocks is the ability to trade stocks directly with USDT. Investors don’t need to open overseas brokerage accounts, convert currencies into USD, HKD, or KRW, or manage assets across multiple markets. Simply transfer USDT to your stock account and you can trade US, Hong Kong, and Korean stocks—greatly improving cross-market investment efficiency. The platform’s unified account structure also lets users manage both stocks and digital assets in one place, making overall asset allocation more convenient.
Fractional Shares and 24/7 Trading: Boosting Global Investment Flexibility
Beyond global coverage, Gate Stocks offers several features to enhance investment efficiency. The platform supports fractional share trading with a minimum of 0.01 shares, allowing investors to start building positions in high-priced stocks with less capital. Currently, 197 popular stocks are available for 24/7 trading, spanning US, Hong Kong, and Korean markets. These include Apple, NVIDIA, Tesla, Meta, Amazon, Tencent Holdings, Xiaomi Group, Samsung Electronics, SK Hynix, Hyundai Motor, and more. Investors can respond to earnings releases, major news, and global market shifts at any time, seizing more trading opportunities.
Conclusion
The AI boom remains a key driver in global markets, but as tech valuations continue to climb, volatility may intensify. Both Jeremy Grantham and Ray Dalio caution against overconcentration in a single market or a handful of hot tech stocks, urging investors to strengthen their portfolios through robust asset allocation. For those looking to participate in global tech growth while managing risk, Gate Stocks offers a one-stop platform covering US, Hong Kong, and Korean markets, with access to over 12,500 stocks and ETFs. With support for direct USDT trading, 0.01-share fractional investing, and 24/7 trading, investors can efficiently build global portfolios and capture more long-term opportunities across market cycles.
