Foreign investors are pulling out in droves! TSMC (TSM.US) has fallen out of favor, leading to the worst selling frenzy in Taiwan stock market history.

As TSMC (TSM.US) has fallen out of favor, Taiwan's stock market has suffered its worst foreign sell-off ever. Global funds have sold a net US$11.9bn of Taiwan shares over the past 12 trading days, according to data compiled by Bloomberg, as they sold 155m shares of TSMC, which accounts for more than a third of the island's benchmark index, and saw its shares fall nearly 10 per cent during the period. The decline in the chip industry's valuation bubble has also affected Taiwan's stock market, which is dominated by tech stocks. Investors who once favored AI stocks have become more selective after the popularity of China's DeepSeek. Jeremy Chen and other HSBC analysts said, "While AI remains a transformative force, market volatility and uncertainty have led investors to be more cautious." Considering these challenges, "we will focus on non-tech areas and take a more defensive stance." The benchmark China Taiwan Weighted Index rose for a second day on Thursday, narrowing its decline from the February high to about 5%. TSMC's stock also rebounded after US chip stocks rose overnight. It is reported that TSMC has proposed cooperation intentions with Nvidia, AMD, and Broadcom to jointly invest in a joint venture to operate Intel's wafer foundry.