Ukraine Invasion Sends Chill By TSMC Shares

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Taiwan Semiconductor Manufacturing

shares dropped Thursday as traders worried about Taiwan-China relations in the wake of Russia’s invasion of Ukraine. The chipmaker’s fall was in distinction to gains for the broader semiconductor sector.

TSMC stock (ticker: TSM) fell 3.5% to near at $111.88 on Thursday, buying and selling as small as $104.38 earlier in the session. Shares of Taiwan-centered

United Microelectronics

(UMC) fell 1.8% to close at $9.24. The

PHLX Semiconductor Index,
acknowledged as the Sox, was up 3.5%.

GlobalFoundries

inventory (GFS) jumped 14% to $54.80, while

Intel

stock (INTC) was up 4.6% to $46.72.

Superior Micro Units

(AMD) stock was up 6.2% to $116.61, while

Nvidia

(NVDA) inventory was up 6.1% to $237.48.

Wedbush analyst Matthew Bryson advised Barron’s by means of electronic mail that chip stocks may have reacted to the Ukraine problem, with the moves for TSMC and UMC reflecting increasing considerations about Taiwan-China relations.

“I assume it’s really challenging to make clear GFS’s (and to some extent INTC’s) gains nowadays in distinction to the tension each UMC and TSM are viewing with out assuming the sector is extrapolating Russia’s invasion of Ukraine as signaling more chance all around Taiwanese/Chinese relations and Taiwanese belongings,” Bryson states.

Reuters also claimed Thursday that Taiwan warned 9 Chinese aircraft that entered its air defense zone, although Bryson notes that China’s air force flying into Taiwan’s house has been a fairly common event not too long ago. He thinks the China-Taiwan problem is significantly various from what’s going on in Ukraine.

“The latter share a land border, Ukraine is a lot less crucial to the planet economy, and Putin seemingly functions abruptly,” he claims. “In distinction Taiwan is an island (building an invasion considerably extra hard logistic, its semiconductors are irreplaceable today (so it is much much more significant to the West economically), and China tends to perform the prolonged activity.”

TSMC is a crucial provider of chips for the likes of

Apple

(AAPL),

Qualcomm

(QCOM), and AMD. Tensions with China have for years been the firm’s greatest danger, though President Biden has claimed it would defend Taiwan if China invaded. And the implications of such a conflict would access much further than TSMC stock.

Produce to Connor Smith at [email protected]