Morgan Stanley's analyst team, led by Jonathan Garner, recently released research reports stating that technology stocks currently appear to be "overbought and expensive", and it's time to "take a break and watch from the sidelines". The report believes that the overall valuation of Asian stock markets had peaked before the first rate cut by the Fed, and emphasized that the IT industry's valuation is currently nearly 2 standard deviations higher than the 20-year average from an industry valuation perspective. The report downgraded the rating of Asian tech stocks from previously overweight (OW) to equal weight (EW) for the IT industry. In addition, the report believes that the market-to-sales ratio of major IT companies in Asia/emerging markets is currently at or above the peak before 2021. Taiwan Semiconductor, SK Hynix, MediaTek, Tokyo Electron and Tokyo Precision were removed from the watch list, while Samsung Electronics and Hon Hai Precision were retained. These two companies have lower beta values and are more likely to be affected by the upcoming AI smart phone cycle.