Shares of Taiwan Semiconductor Manufacturing (TSM 0.16%) were among the winners in the artificial intelligence (AI) sector today as several news items contributed to gains in the high-flying group of tech stocks.
As a result, Taiwan Semi stock was up 2.6% as of 10:04 a.m. ET.
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AI stocks rise again
Some of Taiwan Semi’s key partners were making news today, and several AI sector stocks rose today as investors await the start of Nvidia‘s GPU Technology Conference today, where the company is expected to launch new products that could pump up investor excitement about AI even more.
Additionally, Apple, Taiwan Semi’s biggest customer, is reportedly in talks with Alphabet about using Google’s Gemini AI technology in iPhones. While that news doesn’t have direct implications for TSMC, Apple’s expected moves in AI are likely to lead to new business for Taiwan Semi, the world’s biggest contract chip manufacturer.
Yesterday, Taiwan Semi also reported that TSMC is considering building advanced packaging capacity in Japan, which would be the first time it brings its chip-on-wafer-on-substrate (CoWoS) technology outside of Taiwan. The move should increase capacity at a time when demand is soaring, and relieve some of the geographical risk associated with Taiwan.
Can Taiwan Semi keep climbing?
Investors should keep an eye on Nvidia’s conference this week, including Nvidia CEO Jensen Huang’s keynote this afternoon, as Nvidia’s plans are likely to move the AI sector and even the broader stock market.
As the leading contract chip manufacturer in the world, Taiwan Semi will benefit from increased interest and demand for AI chips, especially since it has approximately 90% market share of advanced chip manufacturing.
Expect the stock to continue to be a bellwether for the broader AI and chip industry, which for now, looks like a good place to be.
Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Jeremy Bowman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Apple, Nvidia, and Taiwan Semiconductor Manufacturing. The Motley Fool has a disclosure policy.
