Taiwan Shares End at New High on AI, Eased Middle East Concerns

Why It Matters

The surge underscores Taiwan’s pivotal role in the global AI‑chip supply chain and signals heightened investor confidence amid geopolitical calm, potentially accelerating capital inflows to its high‑tech sector.

Key Takeaways

• Taiex closed at 43,644.40, up 3.26%, fifth‑largest gain ever
• AI hype spurred by Nvidia CEO Jensen Huang’s upcoming Computex keynote
• TSMC rose 2.44%, lifting electronics index 3.85% higher
• MediaTek and ASE each jumped 10% on AI‑chip optimism
• Foreign investors net‑bought NT$49.46 billion (~US$1.58 billion) on the day

Pulse Analysis

Taiwan’s equity market rode a wave of optimism on May 25, as the Taiex breached the 43,600 level for the first time. The rally was two‑fold: a de‑escalation in the Middle East conflict eased oil‑price pressures, while the prospect of Jensen Huang’s speech at Computex ignited fresh AI‑centric buying. Such macro‑political relief combined with sector‑specific excitement created a liquidity surge, pushing daily turnover to NT$1.30 trillion (about US$41 billion), a benchmark for the island’s market depth.

The technology cluster led the charge, with Taiwan Semiconductor Manufacturing Co. (TSMC) gaining 2.44% and dragging the electronics index up nearly 4%. MediaTek and ASE Technology each posted 10% jumps, reflecting investor bets on AI‑chip demand and advanced packaging capabilities. Huang’s visit signals potential collaborations and product roadmaps that could cement Taiwan’s dominance in next‑generation processors, reinforcing its strategic importance to global AI supply chains.

Beyond chips, the rally spilled into traditional heavy‑industry and financial stocks, as investors rotated into China Steel, Delta Electronics and major banks. Foreign institutional buyers added a net NT$49.46 billion (≈US$1.58 billion), underscoring confidence in Taiwan’s market resilience. However, analysts warn the Taiex may be overheating as it nears the 44,000 mark, suggesting volatility could rise if sentiment shifts or global risk factors re‑emerge.