The 2026 chip trade is fracturing. Software is stirring.

Transcript

Tom Is the chip trade finally cracking? SK Hynix just pulled off the biggest foreign listing ever in the US, but Samsung's profit is up nineteen hundred percent and the stock fell seven percent. Something's shifting. Software's stirring. Let's get into it.

Marie I'm Marie, and you're listening to Investment Flash, London Edition, July tenth, 2026. With me as always, Tom and Gerald.

Tom That SK Hynix listing is a monster vote for memory demand. Micron's trading at six point six times forward P-E after a two hundred fourteen percent gain—that's insane value.

Gerald Yeah look, Samsung's profit surge and the stock drop is a classic peak-cycle signal. Oversupply is coming. I'd sell Samsung.

Tom But Gerald, Micron's at six point six times earnings! Even if the cycle slows, that's pricing in a catastrophe.

Gerald Buddy, a stock that's up two hundred fourteen percent with a single-digit multiple usually means the market knows something you don't.

Marie Tom, you've been defending chips all year and now you're calling a rotation? I'm getting whiplash.

Tom Ha—fair. But the data's changing. And then there's the AI sanctions story...

Marie Exactly! Hold on, both of you. The FT says OpenAI and Google sold AI models to blacklisted Chinese firms through Singapore. That's a direct line to tighter export controls. Sell Nvidia, sell AMD.

Tom Come on, Nvidia's forward P-E is under sixteen. Sanctions worry surfaces every few months, and the stock bounces back.

Marie This time it's different—direct model sales. Regulators will notice. And the Chinese ADRs are in the crosshairs too.

Gerald Right. Flip side: sell Alibaba, Baidu, Tencent. They're on the receiving end, and they're already down twenty-plus percent year to date.

Tom Wait, but we were just talking about buying China large-caps. PBOC fixed the yuan below six point eight, first time since twenty twenty-three, and Saudi money is pouring into Hong Kong. You can't have both.

Marie That's exactly the tension, Tom. The macro is good for China ETFs, but sanctions are a micro headwind for tech names. Buy the broad China ETF, but dump the sanctioned ones.

Gerald A barbell within a barbell. Love it.

Tom Exactly.

Marie One hundred percent.

Tom And it fits with yesterday's call—we bought China internet, now we're buying China large-caps. Same macro tailwind, different ticker.

Gerald Alright, across the pond: Hugo Boss. The board told shareholders to reject Frasers' two point seven billion euro bid. It's a classic mergers and acquisitions bump play.

Marie But is this a real catalyst or just posturing? Frasers could walk.

Gerald Stock's at eleven point three times trailing earnings, fourteen percent below its fifty-two week high. Market's pricing a higher offer. I think it's worth a punt.

Tom I'm in. Buy Hugo Boss. And sell Frasers—that seven point four times trailing P-E isn't cheap if they have to overpay.

Marie Risk reward is decent, I'll give you that. But if the bid fails, the stock sinks.

Gerald Fashion mergers and acquisitions always makes me think of analysts justifying whatever price they need. 'It's not just a suit, it's a lifestyle.'

Tom Ha—fair enough.

Marie Alright, I'll take an eleven-times earnings lifeline.

Tom My favorite uncorrelated trade: iron ore. BHP's port is facing a strike, Fortescue's got production issues. Buy BHP, buy Fortescue. Best week since May.

Gerald Commodities, Tom. Supply disruptions are temporary. China demand is the long-term story, and it's not great.

Marie No, but the rotation signal is real. Look at Nigeria beating South Korea this year. Frontier value over growth tech. Iron ore fits.

Tom Exactly! Nigeria's ETF is sixty-six percent below its high. That's Gerald's dream deep value.

Gerald I wouldn't touch Nigerian stocks with a ten-foot pole, but the dollar returns are eye-popping. Most original take of the day, honestly.

Marie And the cleanest rotation play is software. The software ETF is down eight and a half percent year to date, twenty percent below its high. If the chip trade is unraveling, money has to go somewhere. Buy software.

Tom Software's been a value trap for months. But... with Micron cheap and the rotation, maybe you're right.

Gerald The barbell: long software, long iron ore. That's the Our View synthesis. Two uncorrelated bets.

Marie Quick fire on India: AI is disrupting IT services. Wipro's down thirty-four percent, but momentum is terrible. Sell Wipro, sell Tech Mahindra.

Gerald And the RBI is sitting on a hundred-billion-dollar dollar short that could wreck the rupee. Sell the India ETF. Currency chaos equals equity outflows.

Tom Meanwhile, oil is weird. Crude's down, but gasoline and diesel are sticky. Inflation isn't dead. Sell the long-dated Treasury ETF.

Marie Wait, Tom—if oil is dropping but products aren't, that's margin compression for refiners, not necessarily inflation. And the bond market isn't buying it. The long-dated Treasury ETF barely budged last session.

Gerald Marie's right. The missing piece is yields. If this was an inflation scare, we'd see a bond sell-off. We're not. Flight to quality?

Tom So we're selling the dollar and buying gold on a story nobody's pricing? That's the contrarian playbook.

Marie Gold is the anti-dollar. The gold ETF is down five percent year to date, twenty-six percent below its high. If dedollarization ever catches on, that's a rocket. Buy it.

Gerald Shorting the dollar near its high is a hero trade. I'll pass, but I see the logic.

Tom Counter-argument: SK Hynix's listing is a twenty-six billion dollar vote for memory. If the AI trade roars back, our chip shorts burn. Micron's the hedge.

Marie That's the barbell! We own Micron and software. We don't have to be perfect.

Tom Exactly.

Gerald And Nvidia at fifteen point nine times forward isn't expensive. Sanctions might be noise.

Tom Risk-parity funds are the unknown risk. If the chip-software correlation breaks, their models blow up.

Gerald Great, another systemic risk to lose sleep over.

Marie Welcome to my world, Gerald.

Tom Remember yesterday when we said 'Iran bombs, stocks buy'? The market's one-track mind is something.

Marie As always, none of this is investment advice. Do your own research.

Tom If you're just finding us, hit follow on Spotify. Full digest with charts and sources at investmentflash.com.

Marie We're back later today for the New York Edition, nine a.m. New York time. See you then.

Gerald Until then, may your barbells stay balanced.

Marie Ha—bye everyone.