I think the divergence can hold through CPI, but probably not indefinitely.

The semiconductor sell-off is being driven by a sector-specific issue: fears that CXMT's DRAM advances could eventually weaken memory pricing power. CPI, meanwhile, is a macro catalyst affecting rates and valuations across the whole market. Consensus expects September headline CPI at 3.6% YoY and core CPI at 2.5%.

A softer core print could pull yields down and give semis a strong relief bounce, especially after the sharp sell-off. But a hot print would be more dangerous for chips because they would face two pressures at once: higher discount rates plus renewed concerns about Chinese memory competition.

So my base case is that CPI determines whether this divergence narrows or widens. Soft CPI = semis likely catch up. Hot CPI = broader equities may start catching down to semis instead.

The next test is Warsh. His IMF appearance on 16 October could reset rate expectations again before the 27–28 October FOMC meeting.