Strategist: High expectations led to a pullback in Asian tech stocks, and the industry's inflection point has not arrived

Comparing news, David Chao, a global market strategist at Invesco Asia Pacific, said that Asian technology stocks had a bad start to the week. Previously, the revenue of a major US semiconductor company fell short of expectations and did not raise AI business guidelines, which triggered a sell-off in US stocks.

Asian tech stocks are directly linked to the US semiconductor cycle because they share the same supply chain and investor positions. However, the strategist said he doesn't think a company's quarterly earnings report predicts upcoming industry trends. This is simply because the market's expectations that AI guidelines will continue to rise have become too high.

In Asia, the AI investment narrative has become quite concentrated, mostly driven by a few companies in South Korea and Taiwan. These concentration risks make the market much more vulnerable. As a result, when a company's performance is disappointing, or demand or supply is disrupted, one sees extraordinary market fluctuations.