AI infrastructure stocks and emerging market equities are leading investment returns through the first half of 2026, with semiconductor and tech-related assets in developing economies delivering triple-digit gains as artificial intelligence spending accelerates globally.
The MSCI Emerging Markets Index delivered a 34.4% return in US dollars in 2025 and has continued strong performance into 2026, rising 11.5% year-to-date as of mid-February, according to J.P. Morgan Asset Management. Earnings growth, rather than valuation expansion, has driven the majority of these gains—earnings contributed 47% to emerging market total returns in 2025 but just 13% to developed markets like the Eurozone, indicating fundamentals are supporting the outperformance.
The standout winner is Micron Technology, the memory chip manufacturer. According to NerdWallet, Micron delivered the best one-year performance among AI stocks, climbing 703.29% through mid-June 2026. The surge reflects soaring demand for high-bandwidth memory (HBM) used in AI data centers, with Micron’s entire 2026 HBM supply already sold out under fixed-price contracts, providing revenue visibility through the year and into 2027.
Broader semiconductor stocks have also surged. The Invesco PHLX Semiconductor ETF (ticker: SOXQ) was up 99% year-to-date as of mid-June 2026, according to U.S. News. Companies supplying the infrastructure behind AI—from lasers and optical chips to testing equipment and servers—have delivered gains of up to 2,200% in the first half of 2026, Euronews reported. Swedish laser maker Sivers Semiconductors led Europe’s AI stock gainers with a 2,245.93% rise after announcing a partnership with GlobalFoundries on silicon photonics for AI data centers.
Emerging markets are benefiting from structural tailwinds tied to AI expansion and geopolitical shifts. J.P. Morgan identified three key drivers: the AI capex supercycle cascading through the semiconductor stack to support Taiwan exporters and ASEAN economies like Malaysia and Vietnam; Europe’s defense spending pivot, which has reshaped procurement and elevated South Korea as a fast-delivery, NATO-compatible supplier; and global focus on energy and resource security, which supports Latin American commodity exporters and materials-heavy emerging market economies.
The dollar’s gradual decline also supports emerging market returns for US investors. J.P. Morgan forecasts the dollar could decline 2-4% annually over the next 5-7 years, easing external financing conditions for emerging market borrowers. This backdrop has prompted major asset managers to favor emerging market equities, with State Street Global Advisors noting consensus expects 21% earnings per share growth in emerging market equities in 2026, substantially higher than the 15% expected for the US and 13% for developed markets.
However, not all gains rest on current earnings. Several European AI infrastructure stocks are loss-making or trading on expectations of future demand rather than present revenues. Swedish Sivers Semiconductors, despite its 2,245% gain, reported a net loss of roughly 187 million Swedish kronor in full-year 2025 and saw first-quarter 2026 revenue actually fall about 22%. Investors are betting on order pipelines and the promise of a photonics ramp still to come, Euronews noted. The sustainability of these gains will depend on how quickly AI infrastructure spending translates into revenue and profits.
Sources
- J.P. Morgan Asset Management — MSCI Emerging Markets Index returns, year-to-date performance, earnings contribution analysis, and structural drivers of emerging market outperformance in 2026.
- NerdWallet — Micron Technology’s one-year performance of 703.29% as of mid-June 2026.
- Euronews — European AI infrastructure stock performance, including Sivers Semiconductors’ 2,245.93% gain, and analysis of profitability versus valuation expectations.
- U.S. News — Invesco PHLX Semiconductor ETF (SOXQ) year-to-date performance of 99% as of mid-June 2026.
- State Street Global Advisors — Consensus earnings per share growth expectations for emerging market equities, US, and developed markets in 2026.
