Shares in Taiwan’s TSMC (NAS100:TSM) dipped after the company’s earnings came in ahead of expectations.
TSM – Daily Chart
The TSM price has been rejected initially at the $300 level on the U.S. market. The closest support of strength comes in at the $225 level, which marked a top ahead of the early-year selling.
Taiwan’s leading chip maker said on Thursday that its net profit surged by almost 40% in the last quarter, boosted by artificial intelligence demand.
Taiwan Semiconductor Manufacturing Corp. is the world’s largest manufacturer of chips. The company reported a record net profit of 452.3 billion new Taiwan dollars ($15 billion) for the July-September period. Revenue was higher by 30% year-on-year for the same period.
TSMC is at the centre of a power struggle due to China’s claims to Taiwan and the importance to the U.S. technology sector. The company has been building plants in the United States and Japan to hedge against China-US trade tensions. Nvidia and Apple are two of the key customers supplied by TSMC, and their potential issues could impact global markets if China and the U.S. cannot find common ground on trade.
Attention now turns to the scheduled meeting between Donald Trump and Xi Jinping, expected to happen at the end of October in Korea. Trump has threatened a 100% tariff on Chinese products on November 1 if the two sides do not settle their differences. Trump has also been raising the issue of countries buying Russian oil, and there is still potential for a return to the market panic seen in March when the tariffs were launched.