Taipei: Opposition Kuomintang (KMT) Lawmaker Lin Te-fu raised concerns at a legislative hearing about the significant impact of Taiwan Semiconductor Manufacturing (TSMC) on the Taiex, the benchmark index of the Taiwan Stock Exchange.

According to Focus Taiwan, Lin addressed the legislature’s finance committee, emphasizing that the Taiex has surpassed the 30,000-point milestone for the first time, largely driven by TSMC. TSMC accounts for over 40 percent of the market value, propelling the index upwards while many other stocks remain underperforming. Lin noted that the market structure has become imbalanced, disadvantaging investors who do not hold TSMC shares.

On Monday, the Taiex rose by 755.23 points, or 2.57 percent, closing at 30,105.04. This surge was fueled by TSMC’s impressive 5.36 percent increase to a record NT$1,670.00, spurred by AI market optimism. TSMC’s gains contributed approximately 680 points to the Taiex’s rise. However, despite this positive trend, 749 stocks fell on the main board with only 156 showing gains. The over-the-counter market also reflected a similar pattern with 649 stocks declining and 158 rising.

By Wednesday, TSMC’s stock closed at NT$1,675.00, a decrease of 1.76 percent due to profit-taking, resulting in a 0.46 percent dip in the Taiex. Without TSMC’s influence, the index would have posted gains. Lin pointed out that despite TSMC’s strong performance above its 240-day moving average, 64.87 percent of companies listed on the main board and OTC market are trading below their 240-day moving average, signaling weakness.

Lin also expressed concerns over the impact of U.S. tariff policies on companies in the old economy sector, which are under pressure and struggling to survive. He warned that a potential AI bubble burst could significantly affect the local stock market and harm investors.

In response to these concerns, FSC Chairman Peng Jin-long assured that the Financial Supervisory Commission is prepared to handle market uncertainties as part of its regular duties. The FSC has directed the Taiwan Stock Exchange and Taipei Exchange to promote companies with strong fundamentals to attract investors and enhance stock liquidity.