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TSMC to join Philadelphia chip index

Taiwan Semiconductor Manufac-turing Co (TSMC, 台積電), the world's largest supplier of made-to-order chips, will become the first Asian company to join the Philadelphia Stock Exchange semiconductor index on June 23, the exchange said.

The Philadelphia index includes shares of 17 US companies including Intel Corp, the world's biggest chipmaker. TSMC's inclusion will prompt fund managers who track the index to lift holdings in shares of the company.

"The inclusion reaffirms the global stature of TSMC and, by extension, the Taiwanese electronics industry," said Manish Singhai, who counts shares in the company among the US$2 billion he helps manage in Asia and US$404 billion globally for Alliance Capital Management.

"It should boost market sentiment," Singhai said.

TSMC shares climbed NT$2, or 3.5 percent, to close at NT$58.50 on the TAIEX Thursday.

The index, whose members have a combined market value of more than US$302 billion, will add STMicroelectronics NV, Europe's largest chipmaker, on June 23 and will remove US-based Lattice Semiconductor Corp, the index said on its Web site.

TSMC's customers include chip designers such as Nvidia Corp and ATI Technologies Inc, the world's largest suppliers of computer graphics chips.

TSMC's other clients include companies with their own chip-making facilities such as Intel and Texas Instruments Inc, the world's biggest maker of chips for mobile phones.

Including other chipmakers, such as United Microelectronics Corp (聯電), TSMC's next-biggest rival, Taiwan accounts for about a fifth of the world's chip production.

The Philadelphia semiconductor index has fallen more than 9 percent in the last 12 months as the chip industry has yet to recover from a two-thirds decline in global sales that started in 2000. Since the beginning of this year, the index has gained more than 31 percent in value on signs of an industry recovery.

TSMC spokesman Tzeng Jinnhaw (曾晉皓) couldn't immediately comment on how inclusion on the index will affect the company.

In other semiconductor news, worldwide semiconductor sales are expected to grow to more than US$180 billion next year, marking a 16.8 percent rise against projected sales this year, the Semiconductor Industry Association said Wednesday.

Global chip sales are seeing rising to US$180.9 billion next year compared with an estimated US$154.9 billion rise, or 10.1 percent, this year, according to the association.

"The recovery is broad-based across computer, consumer and communications applications as they all continue to be drivers for the industry," said association president George Scalise.

"The forecast contemplates a return to higher IT [Information Technology] spending levels and the emergence of multi-function products such as smart phones," Scalise said.

The leading trade group said chip sales are improving overseas but that the US market remains lackluster.

The SIA sees US sales falling this year by US$30.6 billion before rebounding to grow by US$35.4 billion, or 15.7 percent, next year.

"Semiconductor consumption is forecast to continue a migration from the Americas to Asia-Pacific, reflecting the outsourcing of electronic equipment manufacturing, including component sourcing and design services, to the region," Scalise said.

The trade group sees chip sales increasing in Europe, Japan and across Asia Pacific through this year and next.
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