The Taiwan stock market showed strong rebound momentum in the second half of 2025, with major weighted stocks like TSMC, Hon Hai, and MediaTek rallying together to support the market. Investor confidence returned as the index surged during trading hours, reflecting expectations of a sustained bullish trend. However, experts advise cautious risk management and recommend avoiding excessive chasing of highs to navigate market volatility.
Improved international political and economic conditions along with the anticipation of U.S. Federal Reserve interest rate cuts provide policy support for the Taiwan market. The stable night session of Taiwan futures during the U.S. holiday further brought positive sentiment. Combined with Taiwan’s strong export recovery and optimism for the AI industry’s long-term growth, Taiwan stocks possess solid upward momentum. Particularly, TSMC and its supply chain benefit from the U.S. chip plant establishment and advanced packaging demand, fueling growth prospects.
Artificial intelligence has become a key focus for investors, with Taiwan playing an important role in the global semiconductor and technology supply chains. Analysts are optimistic about the performance of specialty chemical suppliers and semiconductor materials companies connected to TSMC, marking a high-growth phase. Geographic expansion of supply chains due to U.S. factory launches also supports diversified and resilient corporate operations.
Despite strong fundamentals, short-term market risks remain with earnings season underway and key economic data releases on the horizon. Some hot theme stocks have shown profit-taking pressure, reminding investors to avoid concentrated bets and maintain capital flexibility against possible corrections. Overall, Taiwan’s stock market trend is sound, but risks and volatility warrant prudence in investment strategies.
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