TSMC Raises Capital Expenditure as AI Momentum Remains Strong

On the 16th, leading pure-play foundry TSMC held its earnings conference call, reinforcing an optimistic outlook for the semiconductor cycle and announcing a significant increase in capital expenditure. The company raised its CAPEX guidance to USD 52–56 billion, well above market expectations, and indicated that capital spending over the next three years will remain above current levels.

Following the briefing, risk assets continued to rally, as TSMCs guidance provided investors with renewed confidence in the sustainability of the AI growth narrative.

Major U.S. Equity Indices Closed Higher

• Dow Jones Industrial Average: +0.6%, closing at 49,442.44

• S&P 500 Index: +0.26%, closing at 6,944.47

• Nasdaq Composite: +0.25%, closing at 23,530.02

• Philadelphia Semiconductor Index: +1.76%, closing at 7,837.30

TSMCs CAPEX guidance of USD 52–56 billion exceeded market expectations of USD 45–50 billion, triggering a broad rally in semiconductor equipment stocks. Applied Materials surged 9.36%, KLA rose 8.41%, Lam Research gained 7.92%, and ASML advanced 6.96%.

(Figure 1: Semiconductor Equipment Stocks Surge on TSMC CAPEX Upside Surprise; Source: US Stock Dreamer)Analyst Commentary

The Q&A reinforced that AI demand remains robust, while rising memory prices have minimal impact on high-end smartphones and PCs. TSMCs view suggests that consumer electronics demand remains resilient, indicating that higher raw material costs are not materially constraining end-product pricing.

A stable consumer electronics outlook also implies a sustained manufacturing inventory restocking cycle, supporting continued momentum across the broader industrial sector. Collectively, these signals point to a macro environment characterized by strong investment and consumption dynamics.

Market analysts estimate that TSMC plans to build 16 new fab sites between 2026 and 2028. Assuming average CAPEX of approximately USD 12 billion per fab, total CAPEX over this period could approach USD 200 billion. This may mark the beginning of an aggressive CSP procurement cycle starting in 2026, with semiconductor demand expected to rise further rather than plateau.

With macro conditions remaining balanced and industry fundamentals offering strong productivity tailwinds, 2026 appears to be a cycle where “buying the trend” remains the dominant strategy.

Gold Technical Analysis

Consistent with our prior assessment, gold prices have reached the Fibonacci extension target at 1.618, corresponding to USD 4,642 per ounce, which we identify as a short-term ceiling.

Prices have now touched the upper boundaries of both the blue and orange channels. From a momentum perspective, traders should remain alert to the risk of a near-term pullback.

The MACD histogram continues to contract. After a day of consolidation, momentum has not re-accelerated higher and remains oscillating around the zero line. As prices move sideways, this supports our view of a bearish divergence between short-term momentum indicators and price action.

At current levels, attempting to call a top and initiate short positions offers limited risk-reward efficiency. A neutral, wait-and-see stance is preferred. For bullish retracements, attention should be focused on the Fibonacci 38.2% and 50% retracement levels as key support zones.

Support Levels

• SUP1: 4,502

• SUP2: 4,458

Resistance Level

• Resistance: 4,642

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