Warsh's Hawkish Comments Spark Rate Hike Fears, Send Samsung and SK hynix Lower

Samsung Electronics and SK hynix fell sharply on Monday morning as hawkish comments from U.S. Federal Reserve Chairman Kevin Warsh sent stocks lower, hinting at a potential September rate hike.

The remarks sparked concern about inflation indicators moving away from the Fed's target, leading to losses in AI and semiconductor stocks. The Philadelphia Semiconductor Index plummeted 3.47 percent, while concerns over growing competition from China weighed on the sector.

Warsh stated that 'inflation indicators have become more concerning' and that the Fed needs confidence that underlying inflation is moving clearly towards its target. 'Otherwise,' he said, 'we have work to do.'

Samsung Electronics was down 3.5 percent to 248,000 won ($180), while SK hynix fell 3.33 percent at 1.59 million won.