Asian Chip Index Falls More Than 2% to Its Lowest Level Since July

Asian semiconductor shares extended losses Monday, sending a regional chip-stock gauge down more than 2% to its lowest since July as investors weighed U.S. AI financing risks and a DeepSeek update.

TSMC, SK Hynix and Advantest were among the biggest drags on the gauge. South Korea’s Kospi fell more than 3% at one point before recovering some ground, while Japan’s Nikkei 225 dropped as much as 2.3% and Taiwan’s benchmark index fell 2%. The Kospi posted its steepest weekly decline since October 2008 last week. Its decline reached 7% on Oct. 15.

Investors weighed financing concerns around U.S. AI infrastructure and the possibility that more efficient models could reduce memory demand. DeepSeek described its weekend model update as faster and less resource-intensive, prompting questions about how much memory future AI models may require. Investors also questioned CoreWeave’s ability to raise capital, while expectations for initial public offerings by Anthropic and Nscale cooled.

Kang DaeKwun, CEO of Life Asset Management, said uncertainty made it difficult to predict when Korean shares would bottom. He identified financing for U.S. companies’ AI projects as a key risk and said Korean chipmakers’ earnings remain heavily dependent on continued U.S. investment in AI infrastructure.

Investors will look to Meta and Tesla earnings this week for a gauge of momentum in AI capital spending.