Software Stocks Outperform Semiconductors as Fund Rotation Accelerates on June 27

On Friday (June 27), U.S. software stocks significantly outperformed semiconductor equities in a notable fund rotation. The iShares Expanded Tech-Software ETF (IGM-US) gained 2.6%, while the VanEck Semiconductor ETF (SMH-US) fell 3.5%, marking a 6 percentage point performance gap. The Philadelphia Semiconductor Index (SOX) declined 4.4%.

ServiceNow (NOW-US) led software gains with a 7.2% surge, followed by Workday (WDAY-US) at 5.6% and AppLovin (APP-US) at 5.3%. Palantir shares rose 4.3%, breaking a seven-day losing streak. Among semiconductors, On Semiconductor (ON-US) tumbled 20% after announcing a $7 billion all-stock acquisition of IoT chip company Synaptics.