AI Hype Continues: Taiwan Stocks Hit Record High, TWD Closes at 31.379

According to CNA, NVIDIA CEO Jensen Huang's visit to Taiwan has fueled AI-related themes, and the Taiwan stock market is riding high, continuing its climb today. However, geopolitical risks remain, and with strong buying of the US dollar, the New Taiwan Dollar (TWD) rose only 0.5 cents against the USD, closing at 31.379, marking a more than three-month high. The total turnover in the Taipei and Yuanta foreign exchange markets was 3.125 billion USD. With the upcoming COMPUTEX Taipei and TSMC's shareholder meeting on June 4, AI themes are heating up. The Taiwan stock market continued its charge today, rising nearly 1,200 points during the session to reach 45,931 points, a historical high, before closing at 45,337.91 points, setting a new record for the closing index. Recently, the TWD exchange rate has closely tracked the Taiwan stock market. Fueled by capital inflows, it opened at 31.36. Despite some volatility in the morning, the strong rise in stocks and the influx of hot money pushed the rate past 31.3, reaching a high of 31.29. However, strong dollar buying from importers and government funds gradually suppressed the gains, with the final close at 31.379. Foreign exchange traders explained that the stalemate in US-Iran negotiations has increased risk aversion. Additionally, concerns about inflation in the US and hawkish comments from Federal Reserve officials have supported the US dollar index, putting pressure on Asian currencies. Traders noted that the TWD is already at a high point, and strong dollar buying near 31.300 has led to range-bound consolidation. However, the upcoming COMPUTEX may continue to fuel themes, potentially providing upward momentum for Taiwan stocks and, in turn, the TWD. Furthermore, the US will release non-farm payroll data this week. Traders pointed out that the strength of the US labor market is crucial to market views on the Fed's monetary policy path, and unexpected data could bring volatility to financial markets, requiring cautious attention.