Taiwan Semiconductor Stock: A Mixed Bag on Friday

Taiwan Semiconductor Manufacturing Company Limited (TSM) stock closed higher on Friday, buoyed by gains in the electronics sector, particularly TSM, which contributed 80 points to the Taiex's rise. The Taiex showed resilience despite mixed signals from U.S. markets, which saw slight declines in the Dow Jones Industrial Average and Nasdaq index on Thursday. Analysts credited TSM's strong performance for lifting the Taiex, contributing to its 80-point rise.



TSM's stock price surged over 101% in the last 12 months, reflecting investors' confidence in the company's growth prospects. The company's strategic partnerships with leading semiconductor designers like Apple and Nvidia ensure a stable and growing customer base, supporting consistent demand for its products. TSM's commitment to investing in research and development (R&D) and capital expenditure (capex) is evident in its plans to commercialize 2nm chips, which will enable it to maintain its technological leadership, enhance cost competitiveness, and expand its customer base.



However, geopolitical tensions between Taiwan and China pose a significant risk to TSM's operations and supply chain. The political tensions between the two countries can create uncertainty and potential risks for TSM's operations. In 2022, Elon Musk, CEO of Tesla Inc., suggested that Taiwan could be designated a "special administrative zone" to ease tensions with China, likening Taiwan's relationship with China to Hawaii's ties with the U.S. This comment highlights the geopolitical concerns surrounding Taiwan and its potential impact on TSM's operations.

Additionally, former U.S. President Donald Trump has expressed concerns about trading with Taiwan, accusing the country of undermining the U.S. chip industry. He criticized the CHIPS Act and vowed to impose tariffs on Taiwanese chips if elected. These political tensions can create uncertainty and potential risks for TSM's operations and supply chain, which can impact its stock performance.

In conclusion, TSM's stock performance on Friday was a mixed bag, with the company's strong performance contributing to the Taiex's rise. However, geopolitical tensions between Taiwan and China pose a significant risk to TSM's operations and supply chain, which can impact its stock performance. TSM's commitment to investing in R&D and capex, as well as its strategic partnerships with major tech companies, helps to mitigate these risks and drive its long-term growth.