A sell-off in global technology hardware stocks deepened Thursday, with Asian chipmakers tracking Wall Street losses as concerns over further Federal Reserve interest rate hikes, financing of artificial intelligence investments weigh on sentiment.
South Korean chip giant SK Hynix plunged over 10%, while rival Samsung Electronics fell 7.1%. Other South Korean chip-related stocks also came under pressure. LG Innotek sank 8.1%, Seoul Semiconductor shed 7.7% and Samsung SDI declined 6.8%.
In Japan, technology investment giant SoftBank Group tumbled 7.9%. Semiconductor testing equipment maker Advantest dropped 6.9%, while chipmaking equipment supplier Tokyo Electron lost 5.4%. Renesas Electronics declined 5.4%.
The declines come as investors grow increasingly concerned that higher borrowing costs could weigh on the massive capital spending required to build out AI infrastructure, putting pressure on technology companies that have benefited from the AI investment boom.
Chief executives of Broadcom and Intel warned on Monday that financing could become a major headwind to the AI boom, with Broadcom's Hock Tan saying it could be bigger challenge to AI expansion than shortages of chips or electricity.