Semiconduttori

TSMC sends chip stocks soaring. New highs also for NVIDIA

After periods of difficulty in the chip and semiconductor industry, stocks have recovered ground and, in some cases, even surpassed fundamental chart levels, increasing market participants' enthusiasm for the sector.
The positive reaction stems from the exceptional growth prospects announced by the manufacturer TSMC, which triggered a favorable movement for the entire industry.
Here are the current dynamics on the stock market and the aspects to monitor more carefully.
TSMC: What fueled the euphoria behind the stock? Taiwan Semiconductor Manufacturing surprised market participants during its earnings call by forecasting revenue growth of more than 20% in 2024.
The world's largest chipmaker attributes this expectation to the exceptional expansion of the high-end chip market, used in artificial intelligence systems.
This statement came in conjunction with the sharing of quarterly data, showing net profit above market consensus, despite a 19% decline.
The company expressed no concerns, citing the strong cyclical nature of company fundamentals in the sector, often influenced by external variables.
It also announced plans to expand its productivity globally, with projects in Germany, Japan and Arizona.
Semiconductor sector: what's happening on the stock market? This news caused a gap-up opening for TSM shares, which opened more than 7% higher than Wednesday's prices, surpassing 2023 highs and reaching the $110 mark, long awaited by investors.
This has also generated strong appreciation for competitors, particularly NVIDIA, whose NVDA shares reached new all-time highs, surpassing $550 and approaching $600.
Also in Italy, there was a strong rise in the STMicroelectronics stock, which extended its gains above 3% on Thursday, in line with the sector trend.
Overall, this has resulted in significant appreciation for the entire sector, as evidenced by the MSCI ACWI IMI Semiconductors & Semiconductor Equipment Index, which appreciated by more than 3% on Thursday.
The trend is reflected in the chart of iShares MSCI Global Semiconductors, one of the most traded ETFs on the topic of semiconductors and chips, which is moving towards reaching new all-time highs, marking one of the best performing periods in the history of the sector.

Author: A.W.M.

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