Trump's Taiwan warning rocks TSMC, but profits soar
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STORY: The Trump effect is rocking Asian chip stocks, including Taiwan chip giant TSMC. On Thursday the world’s biggest contract chipmaker reported a 36% jump in second-quarter profit. That beat market forecasts, and was driven by a surge in demand for AI products. And yet shares in the firm - Asia’s most valuable listed company - closed down by 2.4%. Markets were focused on earlier comments by Donald Trump, who said Taiwan had taken “100%” of America’s chip business. He said the island should pay the U.S. for its defense in return, adding geopolitical alarm to the tech tensions.
Taiwan’s foreign ministry felt compelled to respond on Thursday, with a spokesman saying it was committed to boosting defense spending and working with Washington. But Trump’s comments added to existing tensions over U.S.-China relations. Reports in recent days have said the Biden administration could step up curbs on chip exports, prompting a big sell-off for tech stocks. Thursday saw South Korea’s SK Hynix lose around 4%, while Japan’s Tokyo Electron was off more than 8%. That followed a big drop on Wall Street, where tech stocks saw $500 billion wiped off their market value.
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