Taiwan Stocks Surge Nearly 60% in First Half: Taiex Closes at 46,125, TSMC Rises 55%, MediaTek Soars Nearly 200%

TradingKey - During the Asian trading session on June 30, the Taiwan stock market marked its final trading day of the first half of 2026. The Capitalization-Weighted Stock Index (Taiex) closed Tuesday up 1,126.01 points, or 2.5%, at 46,125.91 points. For the entire first half of the year, the benchmark index rose from 28,963 points at the end of last year, registering a cumulative gain of nearly 60%.

[Source: TradingView]

Robust performance in semiconductor and AI exports served as the core driver pushing Taiwan equities higher. During the first half of the year, the Taiex briefly scaled an intraday record high of 48,218 points. It subsequently underwent a sharp correction, falling for four consecutive days and shedding 1,894 points in a single week, briefly dipping below the key 45,000-point threshold. Tuesday's surge brought a respectable close to the first half.

In terms of individual stocks, Taiwan Semiconductor Manufacturing Co. (2330), the most heavily weighted component, surged approximately 55% in the first half of the year. On June 30, TSMC opened up NT$70, hitting an intraday high of NT$2,475. TSMC's ADRs ( TSM) jumped 5.25% in the previous trading session, boosting opening sentiment in the local market.

[Source: TradingView]

Leading IC designer MediaTek (2454) delivered an even more stellar performance, racking up a gain of over 192% in the first half. On June 30, MediaTek closed at NT$4,245, surging 8.57% to reclaim the NT$4,000 round-number threshold. Foreign institutional investors recently raised MediaTek's target price to NT$10,000. Market optimism surrounding MediaTek's AI ASIC business continues to build, with expectations that it will become a new growth engine for the company between 2027 and 2028.

[Source: TradingView]

On the macroeconomic front, the Directorate-General of Budget, Accounting and Statistics (DGBAS) in late May upgraded its full-year 2026 GDP growth forecast to 9.64%, a 16-year high; preliminary GDP growth for the first quarter stood at 14.55%, a nearly 48-year high. Ministry of Economic Affairs data showed that export orders from January to April totaled $319.36 billion, a 49.5% year-on-year increase. Export orders for the single month of April reached $87.45 billion, the second-highest monthly figure on record.

As of June 30, the total market capitalization of the Taiwan stock market has exceeded $5.1 trillion, overtaking France, the UK, Canada, and India over the course of the year to rank fifth globally.

What is the outlook for the second half of the year?

Major investment advisory firms are generally optimistic about the market outlook for the second half of the year. Goldman Sachs ( GS) raised its target price for the TAIEX to 51,000 points in early June and upgraded its rating to Overweight, citing that AI investment will drive the earnings growth of tech hardware companies to continue through 2028 and beyond.

Among domestic investment advisory firms, Capital Investment Advisory is the most optimistic, setting a target price of 53,000 points, which is currently the highest forecast in the local investment advisory circle. Capital Investment Advisory believes that TSMC's 2027 after-tax earnings per share (EPS) could reach NT$130, and based on a 20x P/E ratio, its target price could reach NT$3,000. Fubon and Taishin both believe that this year's high will fall in the fourth quarter, while Mega Securities estimates it has a chance to reach 50,000 points. KGI Securities Investment Advisory pointed out that the year-on-year growth rate of earnings for Taiwanese listed companies has been sharply revised upward from the original estimate of 20% to 40%. The consensus among the nine major investment advisory firms is that there is a good chance the high in the second half of the year will reach 50,000 points.

However, there are also underlying concerns alongside the optimism. KGI Securities Investment Advisory warned that when the index rises to 46,000, 47,000, or 48,000 points, the P/E ratio is already not low based on this year's corporate earnings, standing at around 21 times. The positive bias ratio of Taiwan stocks has exceeded 50%. In addition, the potential for interest rate hikes driven by rising inflation in the US, as well as political variables such as the US midterm elections, are risks that warrant close attention in the second half of the year.

TSMC's investor conference on July 16 is the most critical window of observation in the near term. The market generally expects its second-quarter earnings to continue to hit record highs and is closely watching whether the company will raise its full-year capital expenditure (capex) guidance.