Donald Trump announced 100% tariff on semiconductors, and TSM rose sharply at once, first in Taiwan market and later in US market. TSM promised Donald Trump would invest US$165 Billion, but will cover a period of 10 years, not taking out such a sum today.
Actually the above sum included a sum of $65 Billion already invested in the current Arizona plants. The additional amount is $100 Billion of new investment. For those chips that produced in US of course thus avoided the 100% tariff. That is why the price rose sharply. Another beneficiary parties are Samsung and Hynix. But TSM projected the total investment including indirect output will equal to $200 Billion in the next decade. Mind that TSM will grow with NVDA and is said to be the next NVDA.
There are some bad news but market has no response. India continued to buy petroleum from Russia and said it is totally a business decision. For Russia cut the price and sell to India and India re-export to western countries and said if they purchased from Middle East, it would bloom up price and generate inflation. So now India is suffering a tariff rate of 50% which is slightly lower than China’s average 54%, the second high in the world. China will continue to buy Russian oil. But market seemed had no response. Why? A typical bull market is only would response to good news and put aside all bad news. Bank of England just cut interest rate by 0.25% and people believed US will cut soon. Now India is the largest APPL i-phone manufacturer, already overtaken China. But AAPL announced an investment of $100 in US and thus avoided tariff and now waking up from hibernation. Further elaboration will be on Monday’s Market Observation.
About the Author
Daniel Yue has been an active investor since 1980, with experience spanning stocks, currencies, futures, metals, and bonds. A scholar of the Chicago School of Economics, he holds a Certificate with Distinction from Cambridge University and a degree in International Trading from National Taiwan University. He served as Chief Analyst for over 30 years and Chief Mentor at Sincere Finance. In 2017, he received an award from the University of Arizona for financial internship leadership.
The analysis and opinions expressed in this article are for educational purposes only and do not constitute financial advice. Investing involves risk. Please consult a qualified financial advisor before making investment decisions.
About the Author
Daniel Yue has been an active investor since 1980, with experience spanning stocks, currencies, futures, metals, and bonds. A scholar of the Chicago School of Economics, he holds a Certificate with Distinction from Cambridge University and a degree in International Trading from National Taiwan University. He served as Chief Analyst for over 30 years and Chief Mentor at Sincere Finance. In 2017, he received an award from the University of Arizona for financial internship leadership.
The analysis and opinions expressed in this article are for educational purposes only and do not constitute financial advice. Investing involves risk. Please consult a qualified financial advisor before making investment decisions.