Taiwan shares smash records as TSMC hits closing high on AI frenzy

Taipei, Oct. 3 (CNA) Shares in Taiwan smashed records at the end of the Friday session after contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC) hit a fresh closing high amid enthusiasm toward artificial intelligence development, dealers said.

The Taiex, the weighted index on the Taiwan Stock Exchange (TWSE), ended up 382.67 points, or 1.45 percent, at the day's high of 26,761.06 after moving to the day's low of 26,410.03. Turnover totaled NT$463.09 billion (US$15.23 billion).

"The local main board has repeatedly hit new closing highs in the past few sessions as investors continued to embrace high hopes about AI applications, taking cues from a strong showing in shares of U.S.-based AI chip designer Nvidia Corp.," Hua Nan Securities analyst Kevin Su said.

"TSMC, again, served as a driver to the Taiex's upturn, as the stock, which appeared cheaper in valuation than Nvidia shares, kept playing catch-up," Su said, referring to TSMC's price-to-earnings multiple of below 25, compared with Nvidia's more than 30.

TSMC, the most heavily weighted stock here, rose 2.56 percent to close at the day's high of NT$1,400.00, contributing about 280 points to the Taiex's rise and sending the bellwether electronics index up 2.08 percent.

TSMC's buying spread to other large-cap semiconductor stocks, with smartphone IC designer MediaTek Inc. rising 3.12 percent to end at NT$1,320.00. Memory chip suppliers continued to benefit from product price hikes as Winbond Electronics Corp. soared 7.78 percent to close at NT$38.80 and Nanya Technology Corp. gained 4.14 percent to end at NT$83.00.

The AI frenzy also boosted other hardware suppliers, Su said. Quanta Computer Inc., an AI server maker, rose 2.04 percent to close at NT$300.00, and rival Wistron Corp. added 2.68 percent to end at NT$153.50. iPhone assembler and AI server supplier Hon Hai Precision Industry Co. underperformed its counterparts, up only 0.44 percent to close at NT$226.50.

"Despite the Taiex's solid gains, nontech stocks largely moved in weakness as recent furlough reports showed the old economy industry fell victim to the U.S. tariffs," Su said.

Formosa Plastics Corp. lost 2.27 percent to close at NT$36.65, and Formosa Chemicals & Fibre Corp. shed 3.00 percent to end at NT$27.50. China Steel Corp., the largest steel maker in Taiwan, dropped 1.04 percent to close at NT$19.00, while Chung Hung Steel Corp. ended unchanged at NT$15.50.

On profit taking from its recent strong gains, Teco Electric & Machinery Co. lost 0.87 percent to close at NT$113.50, but Fortune Electric Co. rose 1.60 percent to end at NT$572.00.

In the financial sector,, which lost 0.63 percent, Fubon Financial Holding Co. fell 1.03 percent to close at NT$86.50, while Cathay Financial Holding Co. ended unchanged at NT$65.00.

"Washington will release the September nonfarm payrolls data today, which is expected to provide more clues about how the Federal Reserve will carry out its rate cut cycle," Su said.

According to the TWSE, foreign institutional investors bought a net NT$16.96 billion worth of shares on the main board on Friday.