CITIC Securities research report states that entering the second half of 2026, U.S. tech markets continue to fluctuate around high-frequency AI narrative changes, while the transmission of bond CDS to stock prices also correspondingly increases short-term market volatility.

The institution stated that the decline in U.S. semiconductor hardware since early October generally aligns with the market trading logic since mid-June. However, the pressures from macro liquidity and the uncertainty of mid-term elections have been more significant than the temporary pessimistic shift in the AI narrative.

CITIC Securities believes that with the clearing of major macro and industrial disruptions in the past 1 to 2 weeks, as well as a phased return to an optimistic narrative represented by AI, there is potential for a rebound in U.S. tech stocks after the mid-term elections. They suggest that semiconductor hardware should be the primary focus.

Research reports state: 'Ultra-large-scale cloud computing vendors will release their financial reports in the coming weeks, which will be the next major stress test for the AI transaction.'

The text also mentions that the intraday turmoil highlights two major concerns on Wall Street: one is that interest rates will remain 'higher and for a longer period,' and the other is that the economy is overly dependent on a single industry.

In addition, the report also mentioned "nearly halved," but did not further specify which target this referred to.

Despite the modest performance of the PCE data, traders still expect another interest rate hike in December.

New York Fed Chair John Williams stated that the Fed may still need to raise interest rates once more later this year, but there is no need to act hastily at present.