$3.2 trillion rotation from chips to the 'Magnificent 7' has left the S&P 500 going nowhere

The S&P 500 and Nasdaq have been range-bound for over two months as roughly $3.2 trillion rotated between the Magnificent 7 and non-Nvidia chip stocks, with the Magnificent 7 adding about $1.5 trillion in July while semiconductors excluding Nvidia erased nearly $1.7 trillion. Software stocks are broadly positive in July with a median gain of about 6%, while the median semiconductor stock is down nearly 20%, and memory stocks including Micron, Samsung, and SK Hynix have entered a bear market.

Why it matters: Semiconductor ETFs are now trading over $40 billion per day versus $9 billion a year ago, and the next test comes with Big Tech earnings that could determine which side of the range finally breaks.