The dual benefits of the AI boom and tariff exemptions have led TSMC to lead the Taiwanese stock market soaring close to new highs

According to Zhitong Finance APP, driven by the positive outlook for the artificial intelligence industry and the U.S. exemption of certain tariffs on major chip manufacturers, the Taiwan stock market is approaching historical highs. On Wednesday, the Taiwan Weighted Index rose by 1% at one point, nearing the previous closing high set in July 2024, before the gains narrowed. The index has accumulated an increase of about 40% since the low in April, mainly due to the rise in the stock price of Taiwan Semiconductor (TSM.US), the world's largest contract chip manufacturer and a core supplier to Nvidia.

In early August, the U.S. government announced that certain companies, including Taiwan Semiconductor, would be exempt from the previously announced 100% chip tariffs, accelerating the market's upward momentum.

Goldman Sachs analysts Gokul Hariharan and others wrote in a report last Friday: "With the tariff issue largely settled, investors' focus will return to fundamentals, and Taiwan Semiconductor's stock price is expected to enter a significant upward trend."

Taiwan Semiconductor reported better-than-expected earnings for the June quarter and raised its revenue growth forecast for 2025, significantly boosting investor confidence in the artificial intelligence industry. The chip manufacturing giant raised its sales growth forecast in U.S. dollars from the previous mid-point of 20% to about 30%, while also expecting strong revenue growth in the third quarter, with a range of $31.8 billion to $33 billion, significantly higher than $23.5 billion in the same period last year and $30 billion in the previous quarter.

Last Friday, Taiwan Semiconductor announced that its revenue for July reached NT$323.2 billion (approximately $10.8 billion), a year-on-year increase of 26%. This growth trend further confirms that investment in the artificial intelligence sector is accelerating. As a core hub of the global semiconductor supply chain, Taiwan has greatly benefited from the competition among top global technology companies for cutting-edge artificial intelligence models.

Despite facing exchange rate pressure from the appreciation of the New Taiwan Dollar, Taiwan Semiconductor has maintained rapid growth this year, with cumulative revenue from January to July increasing by 38% compared to the same period in 2024. The company is making every effort to increase production capacity to meet the continuously high market demand.

On Wednesday, Taiwan Semiconductor's stock price rose by 1.7% at one point, hovering near historical highs. Data compiled by Bloomberg shows that since April, Apple supplier Hon Hai Precision Industry Co., Ltd. (Foxconn) and Quanta Computer Inc. have also become major forces driving the index's rise