HSBC downgraded Arm to Hold from Buy while lifting its price forecast to $315 from $255, arguing the stock has run well ahead of fundamentals and now offers limited near-term upside. The call comes as investors continue to take profits in richly valued AI and semiconductor names.Meanwhile, Arm also gained support from Taiwan Semiconductor Manufacturing Co Ltd‘s (NYSE:TSM) stronger outlook and higher capital spending forecast, which signaled continued demand for advanced chip technologies.TSMC Forecast Lifts AI Chip SentimentTSMC raised its full-year 2026 revenue-growth outlook to slightly above 40% in U.S. dollar terms. The company also lifted its 2026 capital budget to $60 billion to $64 billion from $52 billion to $56 billion, with most of the spending directed toward advanced process technologies.Technical AnalysisWith ARM at $263.30, the stock is trading 22.7% below its 20-day SMA ($342.60) and 15.7% below its 50-day SMA ($313.88), which frames the current move as a pullback inside a still-bullish longer-term structure. It’s also trading 14.2% above its 100-day SMA ($231.86) and 44.3% above its 200-day SMA ($183.49), so the bigger trend is still pointing up even after the recent cooling.Earnings OutlookThe countdown is on: Arm Holdings plc American Depositary Shares is set to report earnings on July 29, 2026 (confirmed).