Taiwan's market is set for a rough open after a hawkish turn from the Fed and a criminal probe into a major chipmaking supplier, though strong AI demand should cushion the fall.

• New Fed chair Kevin Warsh said inflation has not really improved and called rate hikes the main tool, pushing US chip stocks sharply lower.
• Taiwan index futures fell hard overnight, and analysts warn Monday's open could drop several hundred points.
• Unimicron, a big circuit board and IC substrate maker, is being investigated for shipping China-made boards home and relabeling them "Made in Taiwan"; 14 people were questioned and five released on bail.
• Foreign investors are still holding a large bet against Taiwan stocks in the futures market, adding to the downside risk.
• Offsetting all this: Nvidia's strong outlook, a semiconductor trade show opening this week, August sales reports, and Apple's new iPhone launch next week.

Outlook: Expect choppy trading with money rotating between sectors, and watch whether the index holds its one-month average level around 45,075.