Concerns about the Federal Reserve possibly raising interest rates drag down Asian technology stocks.

Due to market concerns about rising interest rates in the United States, coupled with ongoing doubts about AI spending and high valuations, Asian tech stocks fell across the board on Monday. Samsung Electronics fell by 6.2%, while memory chip manufacturer SK Hynix fell by 2.3%. The benchmark Korea Composite Stock Price Index plummeted by 8.4% in early trading on Monday, prompting the exchange to temporarily halt trading. The world's largest chipmaker, TSMC, fell by 2.5%. Foxconn Technology Group dropped by 5.4%, while MediaTek also fell by 5.4%. In Japan, Tokyo Electron dropped by 6.7%, and Kioxia fell by 8.7%. Following a 4.2% decline in the tech-heavy Nasdaq index on Friday, semiconductor-related stocks led the decline. Nine tech companies with trillion-dollar market values in the S&P 500 collectively lost about $1.1 trillion in market value on Friday. Sharmin Financial's Chief Investment Strategist, Charu Chanana, said that the market is being dragged down by several simultaneous factors, including questions about the sustainability of AI funding and the prospect of higher U.S. interest rates. Stronger-than-expected U.S. job data for May has made investors uneasy, as a strong labor market could prompt the Fed to raise rates. Union Chang International Research stated that the better-than-expected data has increased market expectations of a 25-basis-point rate hike in December. James Smith, an economist at Netherlands International Group, stated in a report that the cyclicality of AI-related spending has raised market scrutiny, meaning that only a few companies are raising funds, buying chips, leasing computing power, and confirming income among themselves. However, the Netherlands International Group also stated that with continued investments in AI data centers, the fundamentals of the semiconductor sector remain strong.