To The Moon

After several brutal sessions, global technology stocks finally staged a powerful rebound.

The Nasdaq rose 2.8%, while Microsoft’s post-earnings surge helped lift AI chips, cloud stocks and data-center names across the board.

The move became even more dramatic in Asia.

South Korea’s KOSPI jumped sharply, with Samsung Electronics and SK hynix surging as investors rushed back into semiconductor names. Taiwan’s market also rebounded strongly, led by TSMC.

At first glance, this looks like a classic V-shaped reversal.

But the more important question is:

Has the correction really ended, or is the market only beginning a longer U-shaped repair process?

Why did the rebound happen so quickly?

The first reason is earnings.

Microsoft showed that AI spending can already translate into cloud revenue, paid Copilot adoption and strong operating cash flow.

Amazon also reinforced the idea that enterprise AI demand remains solid through AWS.

That matters because the recent selloff was driven by fears that AI capex was rising faster than monetization.

When Microsoft showed that revenue can grow alongside spending, investors were willing to revisit the entire AI infrastructure trade.

The second reason is positioning.

Korean semiconductor stocks had already experienced a violent deleveraging cycle. Margin selling, leveraged products, foreign outflows and momentum unwinds had pushed the market into an extremely oversold condition.

Once a positive catalyst arrived, short covering and forced rebalancing amplified the upside.

So today’s rebound includes two forces at the same time:

A genuine improvement in sentiment, and a technical recovery from extreme positioning.

TigerComments Take: Short-Term V, Medium-Term U

In the very short term, the rebound clearly looks V-shaped.

The market quickly reversed several days of panic and pulled money back into semiconductors, cloud platforms and AI infrastructure.

But over the next several weeks, the recovery is more likely to resemble a U.

Why?

Because price can recover faster than confidence.

The left side of the V was created by panic, leverage and crowded positioning.

The bottom of the U will require:

• Valuation adjustment

• Position rebuilding

• Better market breadth

• More earnings confirmation

• Stable bond yields

• Proof that AI revenue can keep pace with capex

The right side only becomes durable when those conditions begin to align.

1. The technical damage has not fully healed

One powerful session can confirm that buyers are present.

It cannot prove that all forced selling is finished.

Korean chip stocks may have surged, but they are still recovering from a large monthly decline. Many investors remain trapped at higher prices, while leveraged positions and foreign flows may continue to create volatility.

A true V-shaped reversal would require:

• Key indexes to reclaim prior support levels quickly

• Pullbacks to hold above recent lows

• Lower volatility during the next correction

• Stronger participation beyond a few mega-cap leaders

If the next decline triggers another wave of forced selling, today’s move will look more like an oversold bounce.

If the market forms a higher low and stabilizes, the U-shaped recovery case becomes stronger.

2. AI earnings are still highly selective

Microsoft and Amazon strengthened the AI monetization story.

That does not mean every AI company has passed the test.

The market is still separating companies into different groups.

Direct monetization

$Microsoft(MSFT)$ and $Amazon(AMZN)$ can charge customers directly for cloud capacity, enterprise AI tools and infrastructure services.

Core hardware

$NVIDIA(NVDA)$, $Taiwan Semiconductor(TSM)$ and $Broadcom(AVGO)$ benefit when hyperscalers continue spending.

Indirect monetization

Companies relying mainly on advertising efficiency, future agents, robotics or long-term applications still need more proof.

The rebound may therefore remain uneven.

Businesses with real customers, visible pricing and strong cash flow are likely to recover faster.

Companies whose AI value still depends on distant expectations may struggle to regain previous valuations.

3. Korea’s deleveraging is not over after one strong day

The Korean market’s weakness was not caused by one disappointing earnings report.

It reflected a fragile trading structure:

• Heavy index concentration in Samsung and SK hynix

• Elevated retail leverage

• Leveraged ETFs

• Foreign investor selling

• Crowded semiconductor positioning

A one-day surge can reduce margin pressure, but it does not automatically normalize the market.

The next signals matter more:

• Does margin debt continue to decline?

• Do foreign investors return?

• Do leveraged products stabilize?

• Can the KOSPI avoid another cascade during the next pullback?

• Can Samsung and SK hynix hold higher lows?

Price repair can happen in one session.

Structural repair takes longer.

4. Macro pressure is still present

The Federal Reserve kept rates unchanged, but several officials supported a hike.

Long-term Treasury yields remain elevated.

That matters because AI infrastructure is capital-intensive.

Higher yields increase:

• Data-center financing costs

• The discount rate on future technology earnings

• Pressure on companies with weak free cash flow

• Investor preference for current cash generation

A sustainable V-shaped recovery would be much easier if funding costs were clearly falling.

That condition is not yet in place.

The market still has to navigate inflation, energy prices, employment data and the Fed’s policy stance.

What would confirm a true V-shaped reversal?

A stronger V-shaped case would require several things to happen together.

Broader participation

The rebound should spread across chips, memory, equipment, networking, software, power and cooling.

A rally driven only by Microsoft, Amazon and Nvidia would still look narrow.

Stable credit and bond markets

Technology stocks need Treasury yields and corporate credit spreads to stop tightening financial conditions.

Better follow-through

Indexes should hold gains for several sessions and avoid immediately retesting the lows.

Continued earnings confirmation

More companies need to show that AI spending is creating real revenue, margins and cash flow.

Healthier positioning

Korean and U.S. semiconductor markets need less leverage and less violent forced selling.

Without those signals, the rebound remains vulnerable.

Which parts of the market may recover first?

AI cloud platforms

$Microsoft(MSFT)$
$Amazon(AMZN)$

These companies have the clearest paths from infrastructure spending to customer revenue.

AI chips and manufacturing

$NVIDIA(NVDA)$
$Taiwan Semiconductor(TSM)$
$Broadcom(AVGO)$
$Advanced Micro Devices(AMD)$

Their order outlook remains tied to hyperscaler capex.

Memory and storage

$Micron Technology(MU)$
$SanDisk(SNDK)$
$Western Digital(WDC)$
$Seagate Technology(STX)$
$iShares MSCI South Korea ETF(EWY)$

This group offers high upside, but also higher sensitivity to Korea’s leverage cycle and memory pricing.

Networking, power and cooling

$Arista Networks(ANET)$
$Credo Technology(CRDO)$
$Vertiv(VRT)$
$Eaton(ETN)$

These companies remain exposed to real infrastructure bottlenecks, though valuations may still need time to stabilize.

TigerComments Take

Today’s rebound matters because it proves that the market has not abandoned the AI story.

Microsoft and Amazon showed that at least part of Big Tech’s AI spending is producing revenue and customer demand.

The explosive recovery in Korean and Taiwanese chip stocks also confirms that the previous selloff included a large amount of forced deleveraging and liquidity stress.

But one strong session does not remove all the risks.

Our current view is:

The price action looks V-shaped in the short term.
The broader market recovery is more likely to be U-shaped.

The panic can reverse quickly.

Confidence, positioning and valuations need more time.

The next important test is not whether stocks bounce again tomorrow.

It is whether the next pullback holds above the recent lows and whether participation broadens across the full AI supply chain.

What shape do you expect from this recovery?

A. V-shaped reversal: The panic is over and the market quickly recovers
B. U-shaped repair: More time is needed for positioning and earnings confirmation
C. Oversold bounce: Another test of the lows is coming
D. Ignore the index: Focus only on MSFT, NVDA and other core leaders

After Korean chip stocks surged sharply, are you chasing the rebound, waiting for a pullback, or staying in cash?

Disclaimer: This post is for market discussion only and does not constitute investment advice. Investing involves risk. Market data reflects trading through July 31, 2026.