AI summary
Summary of article:
US technology stocks are under pressure due to rising financing costs and concerns about inflation, which have dragged down the concept of AI and may impact the performance of Asian stock markets and technology supply chains on the 19th.
The selling pressure on US technology stocks intensified last week, and this week will pose new risks to Asian artificial intelligence (AI) transactions: The financing cost for the construction of data centers in the United States is increasing day by day, which may cut off the expenditure needed to maintain the current boom, threatening the profits of Asia’s technology supply chain, and adversely impacting the profits of the Asian technology supply chain.asian stocks Rally patience.
Bloomberg News reported that the price of Brent crude oil briefly rose above US$110 per barrel on the 16th, for the first time since May, as inflation concerns soared and interest rates soared, prompting investors to focus on the trillions of dollars of debt borrowed by companies to build AI infrastructure. This increased selling pressure on US technology stocks and US semiconductor stocks fell for eight consecutive days, the longest decline since 2008. The Nasdaq Composite Index fell last week the most since April 2025.
This can have a big impact on the Asian stock market opening on the 19th.
An index compiled by Goldman Sachs Group Inc. based on a basket of Asian AI hardware stocks fell 11% last week, its biggest decline since mid-July. even ifTSMC Revenue forecasts are bright, but sales pressure shows no signs of abating, highlighting investors’ concerns about AI spending spreading throughout the entire hardware supply chain.
Some high-performing Asian stocks have been particularly affected by the turmoil. For example, Nanya Plastics, a printed circuit board (PCB) materials maker that originally outperformed the MSCI Asia Pacific index in terms of profit this year, has fallen 12% from its record high; Xinxing Electronics, the second-best performer on the MSCI Asia Pacific index, also fell 14% in a week, and South Korea’s Samsung Electro-Mechanics fell 23% over the same period.
“The financial cost is like gravity (pushing down) the AI boom,” said Soujanya, a fund manager at GAM Investment Management. “Rising borrowing costs will make it more difficult to finance infrastructure projects and delay spending. Even a delay could trigger a recalibration of Asian suppliers’ profit expectations and valuations.”
The market concern is now not only whether demand for AI chips can be maintained, but also whether hyperscalers and neocloud operators can continue to raise the funds needed to deploy infrastructure, and whether the expected rate of return can justify the scale of investment.
Industry executives have warned about such financing risks, with Broadcom Chief Executive Chen Fuyang saying that lack of capital, not memory or capacity, will be the biggest obstacle to AI development.
Research firm Gartner has also warned that because AI investments may exceed the scale of revenue that can be justified, AI infrastructure spending could be at risk of being cut by more than US$3.5 trillion by 2030.
Summary FAQ
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Rising financing costs for the construction of AI data centers in the United States may reduce corporate spending and expansion, which will lead to weaker orders, profits and valuations in the Asian hardware supply chain and a decline in the performance of related Asian stock groups.
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The Asian AI Hardware Stock Index compiled by Goldman Sachs fell 11% last week, Nanya Plastics fell 12% from its highest level, Xinxing Electronics fell 14% for the week, and Samsung Electro-Mechanics fell 23%, indicating that selling pressure has spread to many stocks in the supply chain.
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Investors are not only worried about the demand for AI chips, but they are also worried about whether hyperscale cloud players and new cloud operators can continue to raise funds, because if funds are insufficient, infrastructure spending may be delayed, and even investments of more than US$3.5 trillion may face the risk of writedown.
