It’s difficult to overstate the influence that TSMC wields on Taiwan’s financial markets. Making up almost a third of the local benchmark, it has single-handedly pushed the Taiex past a record that had stood for three decades. Its rally is attracting foreign flows into Taiwanese equities, increasing demand for the local currency. The Taiwan dollar rose 1% Tuesday to the strongest since April 2018.
The latest boost to TSMC’s shares came after Intel Corp. warned last week that its 7-nanometer chips are behind schedule and it may outsource their production. The U.S. chipmaker is expected to funnel new business to TSMC, given its global lead in silicon fabrication and track record of making semiconductors for the world’s largest tech corporations.
A report on Monday suggested that Intel had placed orders with TSMC for 180,000 units of 6nm chips for 2021. Meanwhile, brokerages including Nomura Holdings Inc. and Credit Suisse Group AG upgraded TSMC to the equivalent of buy.