Taiwan Semiconductor Manufacturing faces a host of challenges that have weighed on TSM stock lately. But on Wednesday TSM stock snapped a four-day losing streak.
On the stock market today, U.S. shares of the world's top chip foundry surged 12.3% to close at 158.75. In the prior four days, after news of the Trump tariffs, TSM stock retreated 17%.
TSM stock was down as much as 2.5% in intraday trading Wednesday before surging after President Donald Trump announced a 90-day pause on new tariffs for more than 75 countries, but not China.
For now, semiconductors are exempt from the Trump tariffs. But Taiwan Semi's chips are in products from a who's who of tech companies. The foundry, better known as TSMC, produces chips for AMD, Apple, Broadcom, Qualcomm, Nvidia and more.
Analysts say the Trump tariffs could cause "demand destruction" for finished tech products like computers and smartphones. That, in turn, would hurt TSMC's sales.
Meanwhile, TSMC reportedly could face a fine of $1 billion or more to settle a U.S. export control investigation over a chip it made that ended up inside a Huawei AI processor, Reuters reported Tuesday. China-based Huawei is on a U.S. trade list that restricts it from receiving goods made with U.S. technology.
The U.S. Department of Commerce has been investigating TSMC's work for China-based Sophgo. The design company's TSMC-made chip matched one found in Huawei's Ascend 910B artificial intelligence processor, Reuters said.
TSM Stock News: March Sales Report Due
In other news, Trump late Tuesday said he threatened TSMC with large tariffs, up to 100%, to get the company to build chip plants in the U.S., Reuters reported.
TSMC already has built a leading-edge semiconductor manufacturing plant in Arizona, as part of an ongoing $65 billion investment.
At the White House in March, TSMC announced plans for an additional investment of $100 billion in the U.S. With that funding, it plans to build three new fabs, two advanced packaging facilities and a research and development center.
The next potential catalyst for TSM stock will be the company's March sales report, due out Thursday.
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