Chip Rout Deepens; Trump Talks Up Iran Diplomacy | Bloomberg Brief 07/28/2026

Watch on YouTube ↗  |  July 28, 2026 at 12:57  |  43:28  |  Bloomberg Markets
Speakers
Henrietta Pacquement — Fixed Income Investment COO, Allspring Global Investment
Neil Campling — Tech/TMT Analyst
Abeer Abu Omar — Reporter, Bloomberg London
Chloe — Reporter, Bloomberg
Benedikt Kammel — Editor/Reporter, Bloomberg (Germany)

Summary

Global chip stocks extend a brutal selloff driven by fears of Chinese AI competition and doubts about AI spending sustainability, triggering rotation into other sectors. Oil prices drop sharply as Iran and Oman discuss restarting Strait of Hormuz traffic and President Trump talks up a deal. Ahead of the Fed decision, Allspring Global Investments' Henrietta Pacquement recommends favoring short-to-intermediate Treasuries over long-end bonds and sees opportunity in high-yield primary issuance amid spread widening.

  • Asia chip stocks suffer worst decline in over a year, KOSPI triggers circuit breakers, Samsung and SK Hynix sharply lower.
  • Chip rout blamed on Chinese state-backed chip equipment progress and NVIDIA circular financing concerns.
  • Oil extends decline to around $80/bbl on Iran-Oman negotiations to reopen Hormuz shipping, though on-ground blockades persist.
  • Markets price Fed rate hikes by year-end; Citadel says a hike this week would cement Chair Warsch's credibility and end forward guidance.
  • Allspring's Pacquement: cautious on long-term Treasuries due to heavy issuance, prefers short/intermediate; sees value in high-yield primary market.
  • Neil Campbell warns AI chip momentum trade faces repricing headwinds, volatility significant.
  • J&J climbs on talc litigation settlement; Barclays falls as earnings lag US investment bank peers.
  • Heat waves threaten US power grid, PJM warns data centers could be dropped during peak demand.
Ideas
Henrietta Pacquement Fixed Income Investment COO, Allspring Global Investment 27:07
Avoid long Treasuries, favor short-term.
The long end of the Treasury curve faces headwinds from heavy sovereign and corporate issuance, including hyperscaler funding, and inflation anxiety, making long-term bonds unattractive. Meanwhile, short to intermediate maturities offer better relative value and safety.
Short-term U.S. Treasuries HIGH
Henrietta Pacquement Fixed Income Investment COO, Allspring Global Investment 27:07
Avoid long Treasuries, favor short-term.
The long end of the Treasury curve faces headwinds from heavy sovereign and corporate issuance, including hyperscaler funding, and inflation anxiety, making long-term bonds unattractive. Meanwhile, short to intermediate maturities offer better relative value and safety.
long-term U.S. Treasuries HIGH
Henrietta Pacquement Fixed Income Investment COO, Allspring Global Investment 29:25
Buy high-yield primary on spread widening.
Massive AI data center-related issuance has caused indigestion and spread widening in credit markets, especially high-yield. This volatility creates an attractive entry point to buy new issues in the primary market and lock in interesting yields.
High-Yield Corporate Bonds HIGH
Neil Campling Tech/TMT Analyst 37:36
Avoid AI chip stocks amid repricing.
The AI chip momentum trade is under severe repricing pressure. China is catching up fast without access to leading IP, while circular financing concerns around NVIDIA inflate perceived AI demand. This fuels a loss of confidence and significant volatility, making AI chip stocks unattractive.
AI chip stocks MED
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This Bloomberg Markets video, published July 28, 2026, features Henrietta Pacquement, Neil Campling discussing Short-term U.S. Treasuries, long-term U.S. Treasuries, High-Yield Corporate Bonds, AI chip stocks. 4 trade ideas extracted by AI with direction and confidence scoring.

Speakers: Henrietta Pacquement, Neil Campling  · Tickers: Short-term U.S. Treasuries, long-term U.S. Treasuries, High-Yield Corporate Bonds, AI chip stocks