Stock market index TAIEX experiences a surge, buoyed by news of tariff exemptions from the United States.
The Taiwan Stock Exchange (TAIEX) experienced a significant surge on Tuesday, reaching a close of 24,003.77 points, its highest this year. The index climbed by 556.41 points, or 2.37 percent, buoyed by strong performances from key tech companies.
Taiwan Semiconductor Manufacturing Company (TSMC), the world's largest semiconductor foundry, closed at a record NT$1,180, an increase of NT$55, or 4.89 percent. TSMC contributed 457 points alone to the TAIEX gain. The surge was also driven by MediaTek Inc, which rose 2.65 percent to NT$1,355. Hon Hai Precision Industry Co, better known as Foxconn, climbed 4.57 percent to NT$194.50. GlobalWafers Co gained by the daily limit to close at NT$375.
The near-term outlook remains "cautiously optimistic," supported by solid tech fundamentals and improving valuations. However, uncertainty surrounds the impact of US tariff policies on the tech sector.
Recent executive orders and tariff modifications apply broadly to imports from certain countries, including China, with added tariffs that cover many product categories. Yet, there is no explicit extension of tariff exemptions specifically for semiconductor manufacturing equipment, laptops, or smartphones for U.S.-based companies.
Professional services firms, such as PwC Taiwan and EY Taiwan, have urged companies to assess their supply chain exposure and prepare contingency strategies. EY Taiwan warned that companies or their contractors planning to build US manufacturing facilities might need to apply for new interpretive rulings to determine whether equipment used in plant construction qualifies for exemptions or individual approvals.
The gains on the main board yesterday expanded to NT$452.976 billion (US$15.19 billion). The surge was led by gains in Taiwan Semiconductor Manufacturing Co (TSMC).
Despite the tariff uncertainties, the US President's announcement of a 100 percent tariff on imported semiconductors, but exempting companies operating or building plants in the US, is seen as a major boon for firms expanding US operations, including TSMC, Nvidia, and Apple. TSMC is investing heavily in a multibillion-dollar plant in Arizona.
However, firms that fail to obtain such exemptions could still face the full 100 percent tariff, according to EY Taiwan. PwC also highlighted the need for further clarity on investment thresholds required for exemption eligibility and implementation details from the White House or US Customs and Border Protection.
Foreign institutional investors were net buyers of NT$43.24 billion of local equities, further fuelling the TAIEX surge. Despite the uncertainties, the Taiwanese tech sector continues to show resilience and optimism, driven by strong domestic and international demand for semiconductors.
- The strong performances from tech companies, such as Taiwan Semiconductor Manufacturing Company (TSMC), MediaTek Inc, Hon Hai Precision Industry Co (Foxconn), and GlobalWafers Co, significantly contributed to the surge of the Taiwan Stock Exchange (TAIEX), with TSMC alone contributing 457 points to the TAIEX gain.
- Amidst the uncertainties surrounding US tariff policies, the US President's announcement of a potential 100 percent tariff on imported semiconductors, but exemptions for companies operating or building plants in the US, presents a significant opportunity for firms expanding US operations, including TSMC, Nvidia, and Apple.
