Shares of Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) closed sharply higher yesterday on reports that Berkshire Hathaway Inc had taken a stake in the world’s largest contract chipmaker.
In a filing with the US Securities and Exchange Commission on Monday, billionaire investor Warren Buffett’s company said it had bought US$4.1 billion of TSMC’s American depositary receipts (ADRs) by the end of September.
The Omaha-based conglomerate acquired about 60 million ADRs in TSMC last quarter, a sign the legendary investor thinks the world’s leading chipmaker has bottomed out after a sell-off of more than US$250 billion.
Photo: Ann Wang, Reuters
That sent TSMC shares shooting up 7.87 percent to close at a two-month high of NT$480.
TSMC produces semiconductors for clients like Nvidia Corp and Qualcomm Inc, and is the exclusive supplier of Apple Inc’s custom silicon chips. Apple remains the most valuable single holding in Berkshire’s portfolio.
The 92-year-old Buffett long shied away from the tech industry, making the case that he did not want to invest in businesses that he did not fully understand. However, that stance changed in recent years, and he has dedicated an increasing proportion of his firm’s investments to the tech sector.
Chipmaking is one segment that promises sustained growth over the coming years as it is essential to the expansion of nascent industries such as self-driving and electric vehicles, artificial intelligence and connected home applications. Expansion of cloud services providers like Amazon.com Inc’s AWS also promises to bring in more orders for chips that go into vast data centers.
TSMC’s gains contributed almost 300 points alone to the TAIEX’s rise, which closed up 371.41 points, or 2.62 percent, at 14,546.31, Taiwan Stock Exchange data showed.
“Many investors here simply followed Buffett in picking up TSMC shares on Tuesday because they are impressed by the American investment guru’s vision and strategies,” Mega International Investment Services Corp (兆豐國際投顧) analyst Alex Huang (黃國偉) said.
“Investors see Buffett as someone who holds stocks for the long term, and the large buy of TSMC shares showed his faith in the chipmaker’s long-term outlook by ignoring short-term market uncertainty,” Huang added.
Berkshire also took a position in Jefferies Financial Group Inc even as it trimmed its stake in financial stocks, including US Bancorp and Bank of New York Mellon Corp, its quarterly filing showed.
New York-based Jefferies was one of three new bets unveiled by Berkshire, in addition to TSMC and construction materials manufacturer Louisiana-Pacific Corp.
Berkshire was a net buyer of equities in the quarter, with US$3.7 billion of purchases after sales. The company trimmed its exposure to financial stocks by about US$4.7 billion in the period.
Additional reporting by Bloomberg
GEARING UP: An invasion would be difficult and would strain China’s forces, but it has conducted large-scale training supporting an invasion scenario, the report said China increased its military pressure on Taiwan last year and took other steps in preparation for a potential invasion, an annual report published by the US Department of Defense on Wednesday showed. “Throughout 2023, Beijing continued to erode longstanding norms in and around Taiwan by employing a range of pressure tactics against Taiwan,” the report said, which is titled “Military and Security Developments Involving the People’s Republic of China (PRC) 2024.” The Chinese People’s Liberation Army (PLA) “is preparing for a contingency to unify Taiwan with the PRC by force, if perceived as necessary by Beijing, while simultaneously deterring, delaying or denying
‘ONE BRIDGE’: The US president-elect met with Akie Abe on Dec. 15 in Florida and the two discussed a potential Taiwan-China conflict’s implications for world peace US president-elect Donald Trump has described Taiwan as “a major issue for world peace” during a meeting with Akie Abe, the widow of late Japanese prime minister Shinzo Abe, Japanese newspaper the Yomiuri Shimbun quoted sources as saying in a report yesterday. Trump met with Akie Abe on Dec. 15 at the Mar-a-Lago estate in Florida, where the two discussed the Russo-Ukrainian war and the situation in the Taiwan Strait. During the meeting, Trump spoke on the implications for world peace of a potential Taiwan-China conflict, which “indicated his administration’s stance of placing importance on dealing with the situation in
QUICK LOOK: The amendments include stricter recall requirements and Constitutional Court procedures, as well as a big increase in local governments’ budgets Portions of controversial amendments to tighten requirements for recalling officials and Constitutional Court procedures were passed by opposition lawmakers yesterday following clashes between lawmakers in the morning, as Democratic Progressive Party (DPP) members tried to block Chinese Nationalist Party (KMT) legislators from entering the chamber. Parts of the Public Officials Election and Recall Act (公職人員選舉罷免法) and Constitutional Court Procedure Act (憲法訴訟法) passed the third reading yesterday. The legislature was still voting on various amendments to the Act Governing the Allocation of Government Revenues and Expenditures (財政收支劃分法) as of press time last night, after the session was extended to midnight. Amendments to Article 4
ALLIANCE: Washington continues to implement its policy of normalizing arms sales to Taiwan and helps enhance its defense, the Ministry of Foreign Affairs said US President Joe Biden on Friday agreed to provide US$571.3 million in defense support for Taiwan, the White House said, while the US State Department approved the potential sale of US$265 million in military equipment. Biden had delegated to the secretary of state the authority “to direct the drawdown of up to US$571.3 million in defense articles and services of the Department of Defense, and military education and training, to provide assistance to Taiwan,” the White House said in a statement. However, it did not provide specific details about this latest package, which was the third of its kind to
RSS