Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) regained its US$500 billion market capitalization after investors ramped up bets on tech leaders best placed to ride an anticipated artificial intelligence (AI) boom.
Asia’s most valuable company gained 3.31 percent yesterday in Taipei trading, fueled also by hopes that a post-COVID-19 chip downturn is nearing an end. That took its gain to 32.22 percent so far this year, cementing its position among the world’s 10 most valuable corporations after overtaking Visa Inc last month.
TSMC’s gains contributed about 160 points alone to the TAIEX yesterday, which closed up 261.23 points, or 1.54 percent, at 17,216.60, the highest since April 14 last year, when the benchmark index closed at 17,245.65.
Photo: Sam Yeh, AFP
“Investors remained upbeat about AI development, and TSMC is one of the biggest beneficiaries,” Mega International Investment Services Corp (兆豐國際投顧) analyst Alex Huang (黃國偉) said.
Morgan Stanley this week raised TSMC’s price target, citing higher demand for energy-efficient and low-cost AI custom chip designs.
“With the killer apps of generative AI [such as ChatGPT], we are seeing the semi industry’s growth stage shifting from the mobile computing to the AI computing era,” Morgan Stanley analysts wrote over the weekend. “We view TSMC as a key enabler of future AI semis given its technology leadership.”
Meanwhile, Cathie Wood’s funds have re-entered TSMC and Meta Platforms Inc after nearly a year and a half, as the high-profile manager makes new bets on AI and chips.
Two Ark Investment Management LLC funds, including Wood’s flagship Ark Innovation ETF, bought 174,848 shares of Facebook’s parent company on Monday, while Ark Autonomous Technology and Robotics ETF picked up 98,170 shares of TSMC, data compiled by Bloomberg showed.
Before this, Ark last held the two stocks in the final quarter of 2021.
Ark’s moves came weeks after Wood spoke highly of Meta’s AI strategy and said her decision to drop Nvidia Corp was due to the company facing growing competition.
She added during an interview with Bloomberg last month that she would pivot “to another set of plays.”
Wood’s other AI-related bets include electric vehicle maker Tesla Inc among large caps and UiPath Inc, Twilio Inc and Teladoc Health Inc among smaller names.
The broader rally persists despite warnings that the market might be getting ahead of itself, given the uncertainty over how to monetize AI services.
TSMC, while touting its own potential role in the rollout of AI, has expressed caution over the outlook for the smartphone market that still comprises a significant chunk of its revenue, although company executives have called for a gradual recovery in the second half and a resumption of growth next year.
Last week, TSMC chairman Mark Liu (劉德音) said the chipmaker’s capital expenditure for this year might wind up close to the bottom end of a previously forecast range of US$32 billion to US$36 billion. That is a signal that TSMC, like its rivals across the electronics industry, remain cautious in the face of plunging consumer spending and an uneven post-COVID-19 economic recovery in China.
Additional reporting by CNA
‘SWASTICAR’: Tesla CEO Elon Musk’s close association with Donald Trump has prompted opponents to brand him a ‘Nazi’ and resulted in a dramatic drop in sales Demonstrators descended on Tesla Inc dealerships across the US, and in Europe and Canada on Saturday to protest company chief Elon Musk, who has amassed extraordinary power as a top adviser to US President Donald Trump. Waving signs with messages such as “Musk is stealing our money” and “Reclaim our country,” the protests largely took place peacefully following fiery episodes of vandalism on Tesla vehicles, dealerships and other facilities in recent weeks that US officials have denounced as terrorism. Hundreds rallied on Saturday outside the Tesla dealership in Manhattan. Some blasted Musk, the world’s richest man, while others demanded the shuttering of his
Taiwan’s official purchasing managers’ index (PMI) last month rose 0.2 percentage points to 54.2, in a second consecutive month of expansion, thanks to front-loading demand intended to avoid potential US tariff hikes, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday. While short-term demand appeared robust, uncertainties rose due to US President Donald Trump’s unpredictable trade policy, CIER president Lien Hsien-ming (連賢明) told a news conference in Taipei. Taiwan’s economy this year would be characterized by high-level fluctuations and the volatility would be wilder than most expect, Lien said Demand for electronics, particularly semiconductors, continues to benefit from US technology giants’ effort
ADVERSARIES: The new list includes 11 entities in China and one in Taiwan, which is a local branch of Chinese cloud computing firm Inspur Group The US added dozens of entities to a trade blacklist on Tuesday, the US Department of Commerce said, in part to disrupt Beijing’s artificial intelligence (AI) and advanced computing capabilities. The action affects 80 entities from countries including China, the United Arab Emirates and Iran, with the commerce department citing their “activities contrary to US national security and foreign policy.” Those added to the “entity list” are restricted from obtaining US items and technologies without government authorization. “We will not allow adversaries to exploit American technology to bolster their own militaries and threaten American lives,” US Secretary of Commerce Howard Lutnick said. The entities
Minister of Finance Chuang Tsui-yun (莊翠雲) yesterday told lawmakers that she “would not speculate,” but a “response plan” has been prepared in case Taiwan is targeted by US President Donald Trump’s reciprocal tariffs, which are to be announced on Wednesday next week. The Trump administration, including US Secretary of the Treasury Scott Bessent, has said that much of the proposed reciprocal tariffs would focus on the 15 countries that have the highest trade surpluses with the US. Bessent has referred to those countries as the “dirty 15,” but has not named them. Last year, Taiwan’s US$73.9 billion trade surplus with the US
RSS