COMPUTEX themes and AI stock catch-up, analysts: Taiwan stocks maintain healthy rotation

The Taiwan stock market has been rising strongly recently, with the single-day increase in margin financing on May 29 hitting a historical high, indicating strong buying interest from retail and domestic investors. Analysts analyze that the strengthening of downstream AI assembly stocks is a favorable signal for maintaining a healthy rotation of the market. With themes such as the Taipei International Computer Show (COMPUTEX) and the TSMC shareholder meeting this week, the index still has room to rise. Despite differing views on the progress of peace talks between the US and Iran, investors expect the two countries to reach an agreement to extend the ceasefire, and the US stock market closed higher on the 29th. The Dow Jones Industrial Average rose 363.49 points or 0.72% to close at 51,032.46; the S&P 500 rose 16.43 points or 0.22% to close at 7,580.06; the tech-heavy Nasdaq rose 55.15 points or 0.2% to close at 26,972.62; and the Philadelphia Semiconductor Index rose 0.239 points to close at 12,829.383. On the 29th, the Taiwan stock market was ignited by the AI sector, and with the MSCI semi-annual adjustment taking effect, the weighted index closed at a new high of 44,732.94 points, up 1,096.5 points, with a turnover of NT$1.81645 trillion, setting a new record. Senior Taiwan stock analyst Tsai Ming-han said in an interview with CNA that there are several key points to observe in the recent market trend. First, although the index has performed strongly over the past week, major weighted stocks have not collectively surged, especially TSMC, which lagged behind the market before May 29. Tsai pointed out that downstream assembly plants in the AI supply chain clearly strengthened last Friday, with veteran AI stocks such as Quanta, Wistron, and Foxconn hitting the daily limit, and Intel-related stocks such as Acer and Asus also surging to the daily limit. This means that groups with relatively lower positions have begun to catch up, which is a favorable signal for maintaining a healthy rotation of the market. Regarding the COMPUTEX exhibition effect that the market is paying attention to, Tsai said that based on historical experience, the stock market usually performs well from before the exhibition to one week after it ends, and the themes and capital market trends brought by the exhibition are expected to last for about two weeks. Moreover, after a period of consolidation following the TSMC investor conference, the stock price has begun to strengthen effectively. TSMC will hold its shareholder meeting this week, which is expected to bring positive help to the Taiwan stock market, and it is expected that the index still has room to continue to rise.