TSMC shares hit their biggest gain since April. At the beginning of the new year, the world's largest chip contract manufacturer was boosted by continued optimism about demand for artificial intelligence (AI). Shares of the major supplier to Nvidia and Apple surged as much as 6.9% to a record high in Taipei. Previously, Goldman Sachs Group raised TSMC’s target share price by 35% to NT$2,330, citing the expectation that the company will maintain solid growth in the coming year.
Taiwan Semiconductor Manufacturing Co. led a broad rally in Asian technology stocks on Monday, as investors poured more money into the AI theme despite overheating concerns. Although the United States launched an attack on Venezuela, the "out of stock" panic overshadowed concerns about short-term fluctuations, and the sector once again became the largest source of power for regional stock markets.
“We believe AI will be TSMC’s growth engine for many years to come,” Goldman Sachs analysts including Bruce Lu wrote in a report. Lu noted that the company is still improving profit margins, although he expects it to invest $150 billion over the next three years to increase production capacity.
Among other chip stocks, South Korea's Samsung Electronics rose for a fifth straight session. The memory maker is expected to report preliminary results later this week.