Yahoo Finance Chip frenzy: AI promise propels semiconductor shares across Asia
Taiwan Semiconductor Manufacturing Co's (TSMC) value soared by NT$1 trillion (US$30 billion) on Thursday amid a global chip stock frenzy fuelled by artificial intelligence (AI), which has become a key disruptive force in a wide range of industries.
The world's biggest contract chip maker's Taipei-listed shares jumped 5.3 per cent to NT$899, hitting their highest listing in 1994. The surge lifted its market capitalisation to over NT$23 trillion, pushing the local benchmark Taiex Index to a record high as well.
TSMC's explosive rally follows a surge in semiconductor maker Nvidia's shares in New York, which took the latter's market value to over US$3 trillion, surpassing Apple to become the world's second-most valuable firm. Chip equipment giant ASML also surged overnight in Europe to become the continent's second-biggest listed company.
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Leading mainland chip companies also joined the party. China's largest chip maker, Semiconductor Manufacturing International Corp, saw its Hong Kong-listed shares jump 5.4 per cent to HK$18.02, a five-month high. Its peer Hua Hong Semiconductor surged 8.1 per cent to HK$22.60. In Seoul, Samsung Electronics' shares rose 3.5 per cent.
TSMC, which counts Apple, Nvidia and SK Hynix among its major customers, has been one of the biggest beneficiaries of the AI craze. The company's stock has surged over 50 per cent this year on the back of a 32 per cent jump in 2023. It now ranks among the world's most valuable companies alongside Meta Platforms and Warren Buffett's Berkshire Hathaway, according to Bloomberg data.
The chairman and chief executive of Taiwan Semiconductor Manufacturing Co (TSMC), C C Wei has reaffirmed expectations for artificial intelligence (AI) development to drive this year's industry recovery. 04JUN24 Photo: CNA alt=The chairman and chief executive of Taiwan Semiconductor Manufacturing Co (TSMC), C C Wei has reaffirmed expectations for artificial intelligence (AI) development to drive this year's industry recovery. 04JUN24 Photo: CNA>
The chairman and chief executive of TSMC, C C Wei, earlier this week touted AI development as a key driver of the industry's recovery this year, reiterating his 10 per cent growth estimate for the global semiconductor market in 2024.
In a move to meet long-term capacity based on market forecasts and technology development road maps, TSMC announced on Wednesday a capital expenditure programme of US$17.36 billion. Spending would cover the installation and upgrade of advanced technology capacity and construction of new semiconductor production facilities.
TSMC also said it plans to buy back 3.25 million shares at a price of between NT$598 and NT$1,281 apiece from June 6 to August 5 to offset the dilutive effect of shares issued through its employee stock award programme.
This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2024 South China Morning Post Publishers Ltd. All rights reserved.
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