Why Did TSMC Plunge 9.88%? Trade Tensions Spark Sell-Off

On April 7, 2025, TSMC's stock price dropped by 9.88% in pre-market trading.

TSMC's stock price has been significantly impacted by the ongoing trade tensions between the U.S. and Taiwan. The potential imposition of tariffs on semiconductor exports has raised concerns among investors, leading to a sharp decline in the company's stock price. High levels of exposure to the U.S. market and the sensitivity of the supply chain in Asia have exacerbated these concerns. Despite TSMC's leadership position in the semiconductor industry and the growing demand for AI and technology, the short-term risks associated with trade tensions have overshadowed these positive factors. The situation remains fluid, and investors are closely monitoring developments in the trade negotiations and their potential impact on TSMC's business operations.

Analysts have noted that the current market volatility is driven by uncertainty surrounding the potential imposition of tariffs on semiconductor exports. The U.S. administration's stance on trade has created a challenging environment for companies with significant exposure to the U.S. market, and TSMC is no exception. The company's stock price has been particularly sensitive to developments in the trade negotiations, with sharp declines observed in response to negative news. Investors are advised to remain cautious and closely monitor the situation as it evolves.