Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) shares fell the most in three months yesterday upon trading resumption, joining a global technology rout as investors dramatically soured on the promises of artificial intelligence (AI).
The shares declined 5.62 percent to close at NT$924 in Taipei, dragging down the benchmark TAIEX, which fell 3.29 percent to 22,119.21 points amid a technical correction, Taiwan Stock Exchange data showed.
Other chip stocks also fell, with ASE Technology Holding Co (日月光投控) plunging 9.86 percent, MediaTek Inc (聯發科) dropping 2.35 percent, Realtek Semiconductor Corp (瑞昱) falling 1.33 percent and United Microelectronics Corp (聯電) retreating 1.17 percent, while Apple Inc manufacturing partner Hon Hai Precision Industry Co (鴻海精密) slumped 4.71 percent.
Photo: CNA
Local markets reopened after a two-day closure due to Typhoon Gaemi.
Lackluster earnings from US technology firms have set off a reckoning on the AI hype.
The latest technology rout adds further pressure on TSMC, whose record-breaking rally has been faltering since the middle of this month. A favored AI play due to its cutting-edge chips and stellar earnings, concern over a pricey valuation and the risk of tighter US curbs on chip sales to China have poured cold water on the bullish momentum.
The rotation out of valuation-stretched technology names has been “exacerbated by weak results from ‘Magnificent Seven’ titans Alphabet Inc and Tesla Inc, and some negative news flow on China tariffs,” Union Bancaire Privee SA managing director Ling Vey-sern (凌煒森) said. “Whether the tech sell-off will continue will depend on key results next week which will see four of the Magnificent Seven stocks report,” such as Apple and Amazon.com Inc.
TSMC shares have now fallen more than 14 percent from their peak. The decline spells trouble for the local financial market given the stock accounts for more than one-third of TAIEX’s weighting.
The change of fortunes for Taiwan’s shares has been swift. Earlier this year, surging interest in AI shares had triggered an unprecedented investment boom. The rally led to retail investors piling into exchange-traded funds, and prompted local regulators to warn over herding behavior.
TSMC’s drop could be due to profit-taking, while “whispers of a potential slowdown in the AI investment boom might also be at play,” Straits Investment Management Pte Ltd chief executive officer Manish Bhargava said. “The wider context of AI momentum can’t be dismissed. The burning question is — is the AI rally running out of steam?”
A TSMC spokesperson said there had been no impact from the typhoon as of Thursday.
Taiwan’s US$2.5 trillion stock market was shut on Wednesday and Thursday as Typhoon Gaemi approached after inundating the Philippines. The last time that Taipei was shut for two days in a row for a typhoon was in 2016.
The New Taiwan dollar gained as much as 0.2 percent against the greenback yesterday, before trading little changed and closing at NT$32.831 per US dollar. Earlier this month, the Taiwanese currency fell to its weakest level since 2016 amid intensified outflows from local equities.
Additional reporting by staff writer
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s largest contract chipmaker, yesterday said its materials management head, Vanessa Lee (李文如), had tendered her resignation for personal reasons. The personnel adjustment takes effect tomorrow, TSMC said in a statement. The latest development came one month after Lee reportedly took leave from the middle of last month. Cliff Hou (侯永清), senior vice president and deputy cochief operating officer, is to concurrently take on the role of head of the materials management division, which has been under his supervision, TSMC said. Lee, who joined TSMC in 2022, was appointed senior director of materials management and
Gudeng Precision Industrial Co (家登精密), the sole extreme ultraviolet pod supplier to Taiwan Semiconductor Manufacturing Co (台積電), yesterday said it has trimmed its revenue growth target for this year as US tariffs are likely to depress customer demand and weigh on the whole supply chain. Gudeng’s remarks came after the US on Monday notified 14 countries, including Japan and South Korea, of new tariff rates that are set to take effect on Aug. 1. Taiwan is still negotiating for a rate lower than the 32 percent “reciprocal” tariffs announced by the US in April, which it later postponed to today. The
MAJOR CONTRIBUTOR: Revenue from AI servers made up more than 50 percent of Wistron’s total server revenue in the second quarter, the company said Wistron Corp (緯創) on Tuesday reported a 135.6 percent year-on-year surge in revenue for last month, driven by strong demand for artificial intelligence (AI) servers, with the momentum expected to extend into the third quarter. Revenue last month reached NT$209.18 billion (US$7.2 billion), a record high for June, bringing second-quarter revenue to NT$551.29 billion, a 129.47 percent annual increase, the company said. Revenue in the first half of the year totaled NT$897.77 billion, up 87.36 percent from a year earlier and also a record high for the period, it said. The company remains cautiously optimistic about AI server shipments in the third quarter,
Nvidia Corp CEO Jensen Huang (黃仁勳) on Thursday met with US President Donald Trump at the White House, days before a planned trip to China by the head of the world’s most valuable chipmaker, people familiar with the matter said. Details of what the two men discussed were not immediately available, and the people familiar with the meeting declined to elaborate on the agenda. Spokespeople for the White House had no immediate comment. Nvidia declined to comment. Nvidia’s CEO has been vocal about the need for US companies to access the world’s largest semiconductor market and is a frequent visitor to China.
RSS