Why Taiwan Semiconductor Manufacturing Stock Is Jumping Today

After sell-offs yesterday, Taiwan Semiconductor Manufacturing (NYSE: TSM) stock is regaining ground in Friday's trading. The company's share price was up 4.5% as of 3:30 p.m. ET. Meanwhile, the S&P 500 index was up 1.6%, and the Nasdaq Composite was up 2%.

TSMC stock saw substantial sell-offs yesterday on news that imported products from China will now be taxed at a 145% rate, but it's roughly bounced back from those losses today. It's been an incredibly volatile week for the stock market, but the chip-fabrication leader's share price is poised to close out the period with solid gains.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Learn More »

TSMC stock is rising amid a bullish rebound for the stock market

The stock market has seen nearly unprecedented swings this week. Valuations headed lower early in the week's trading -- only to see a massive rebound after President Donald Trump announced a 90-day pause on reciprocal tariffs for all countries other than tariffs. Thursday brought sell-offs on news that tariffs on China were actually higher than expected, but investors are buying back into the market today -- and TSMC is rising as a result.

What's next for TSMC?

TSMC stock will likely continue to see big valuation moves in conjunction with macroeconomic and geopolitical news. In the face of risk factors and increased uncertainty on those fronts, the company's share price is down roughly 20% year to date. The valuation pullback has pushed the company's forward price-to-earnings multiple down to approximately 17.5 -- a level that looks quite cheap given the company's recent business momentum and long-term strength in the artificial intelligence (AI) chip manufacturing category.

On the other hand, the earnings picture is in flux right now -- and it's difficult to assess stocks along traditional valuation metrics. Adding another complicating factor, concerns that China could invade Taiwan at some point in the next few years appear to be at the center of the escalating trade war and geopolitical tensions.

Should you invest $1,000 in Taiwan Semiconductor Manufacturing right now?

Before you buy stock in Taiwan Semiconductor Manufacturing, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Taiwan Semiconductor Manufacturing wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $496,779!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $659,306!*

Now, it’s worth noting Stock Advisor’s total average return is 787% — a market-crushing outperformance compared to 152% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of April 10, 2025

Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Taiwan Semiconductor Manufacturing. The Motley Fool has a disclosure policy.