Asian AI Hardware Stocks Drop as US Tech Selloff and Rising Borrowing Costs Hit Markets

A major drop in US tech stocks is creating new problems for Asia's artificial intelligence supply chain as rising borrowing costs threaten to slow down spending. Oil prices recently crossed 110 dollars a barrel for the first time since May, pushing up inflation fears and making investors question the huge amounts of money borrowed to build AI infrastructure.

Market Impact

US semiconductor shares suffered an eight-session rout that wiped about 16 percent off the sector benchmark, while the Nasdaq 100 had its worst week since April 2025. In Asia, a Goldman Sachs basket of regional AI hardware stocks fell 11 percent last week in its steepest drop since mid-July. Top performers took heavy hits as Nan Ya Plastics dropped 12 percent, rival Unimicron Technology fell 14 percent, and Samsung Electro-Mechanics plunged 23 percent. Bonds of cloud provider CoreWeave also sank into distress levels, and its shares slumped 12 percent on Friday for a 25 percent weekly loss.

Industry Warnings

Jian Shi Cortesi, a fund manager at GAM Investment Management, noted that rising borrowing costs could delay infrastructure projects and reset earnings expectations. Broadcom Chief Executive Officer Hock Tan warned that capital would become the biggest constraint on AI growth rather than chip shortages. Gartner has warned that more than 3.5 trillion dollars of AI infrastructure spending could be at risk by 2030 if investment outpaces revenue.

Context

Asian chipmakers like TSMC, Samsung, and SK Hynix depend heavily on the continued rollout of global tech infrastructure to sustain their record-breaking market rallies. When borrowing costs rise for major cloud operators, the financial strain moves down the supply chain to hardware suppliers and component makers across the region.