Taiex ends at new high as TSMC smashes closing records on AI

Taipei, June 22 (CNA) Shares in Taiwan closed at a new high, soaring over 1,200 points Monday, as contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC) smashed previous closing levels amid optimism over global AI development, dealers said.

The Taiex, the Taiwan Stock Exchange's benchmark index, ended up 1,276.31 points, or 2.75 percent, at 47,741.51 after moving between 46,679.57 and 47,871.19. Turnover totaled NT$1.44 trillion (US$45.20 billion).

"Investors took their cue from a rally among chip stocks in the United States last week and chased semiconductor stocks in Taiwan today," Hua Nan Securities analyst Kevin Su said, referring to a 6.42 percent surge on the Philadelphia Semiconductor Index Thursday before a public holiday Friday.

"The buying was sparked by optimism over robust global demand for AI applications, with TSMC in focus on strong high-end chip sales," Su said.

After its American depositary receipts rose 6.94 percent Thursday, shares in TSMC, which accounts for over 40 percent of total market value, rose 4.15 percent to close at NT$2,510.00, contributing about 800 points to the Taiex's rise and sending the electronics index up 3.28 percent.

In addition to chip demand, interest in advanced IC assembly and testing services boosted ASE Technology Holding Co. by 10 percent, the maximum daily increase, to end at NT$674.00.

A supply shortage also continued to push up memory chip supplier Nanya Technology Corp., which surged 10 percent to close at NT$505.00.

United Microelectronics Corp., a smaller contract chipmaker, also jumped 10 percent to end at NT$160.00 after a FundaAI research report indicated U.S.-based Intel Corp. will work with the Taiwanese firm to produce 3-nanometer process chips in Arizona.

"AI-driven buying also rotated to hardware device suppliers and PCB (printed circuit board) makers were highlighted," Su said.

Among them, WUS Printed Circuit Co. surged 10 percent to close at NT$226.00, and Gold Circuit Electronics Ltd. ended up 2.95 percent at NT$1,395.00.

In the old economy sector, Su said select petrochemical stocks also benefited from the AI uptrend as they started to manufacture materials including glass cloth for tech gadget use.

Nan Ya Plastics Corp. soared 10 percent to close at NT$152.50. The company attracted interest also because it is the parent of the high-flying Nanya Technology, Su explained.

With government investments to improve electricity grid networks, Shihlin Electric & Engineering Corp. rose 1.45 percent to close at NT$245.00, and Teco Electric & Machinery Co. gained 3.14 percent to end at NT$72.20.

The financial sector underperformed the Taiex, down 0.81 percent. Cathay Financial Holding Co. lost 2.16 percent to close at NT$113.00, while Fubon Financial Holding Co. ended up 0.36 percent at NT$138.00.

"With the quarter coming to an end, I expect institutional investors to buy stocks to dress up their books and the index could soon challenge 48,000 points," Su said.

According to the Taiwan Stock Exchange, foreign institutional investors bought a net NT$68.46 billion of shares on the main board Monday.