Taiwan Semiconductor Manufacturing Company (NYSE: TSM) saw its American depositary receipts (ADRs) stage a notable rebound in New York trading on Friday morning, clawing back more than half of the steep losses suffered in the previous session. The stock climbed 6.94% to $377.61 by 10:01 a.m. EST, according to Google Finance data, recovering $24.51 of the $42.65 decline recorded on Thursday.
Despite the strong bounce, the recovery remains incomplete. The ADRs are still trading 4.58% below Wednesday's closing price of $395.75, leaving a two-session decline of $18.14. Thursday's drop was particularly sharp, with the stock falling 10.78% from $395.75 to $353.10, its worst single-day performance in recent memory.
The rebound in New York mirrors a similar pattern in Taipei, where TSMC's common shares also regained ground on Friday. The stock opened at NT$2,020, down from Thursday's close of NT$2,240, but recovered to close at NT$2,135. That closing price represents a 4.69% decline from the prior session, but the stock did manage to recover 52.3% of its opening loss during the trading day.
Trading volume in Taipei surged dramatically, with 110.71 million shares changing hands, more than double the 45.18 million shares traded on Thursday. This heightened activity suggests significant investor interest, though the lower close indicates that selling pressure persists. The Taiwan Stock Exchange data also showed that the broader Taiwan index fell 4.51%, putting TSMC's decline roughly in line with the market.
The two listings represent the same underlying business, with each ADR equivalent to five common shares. However, comparing the performance across markets requires careful consideration of different currencies, reference prices, and trading sessions. The New York and Taipei markets operate on different schedules, and currency fluctuations can affect the relative returns.
Investors are now looking ahead to the company's next revenue disclosure, scheduled for November 10. In its October 15 earnings release, TSMC forecast fourth-quarter revenue in the range of $52.3 billion to $54.3 billion, up from $46.72 billion in the third quarter. Chief Financial Officer Wendell Huang cited "strong demand for our leading-edge process technologies" as a key driver, though that comment referred to the third-quarter results.
The market's partial recovery on Friday does not necessarily confirm that the company will meet its fourth-quarter guidance. The revenue forecast remains subject to execution risks and potential changes in customer orders. Additionally, exchange-rate movements could impact the ADR's performance relative to the Taiwan-listed shares.
Analysts note that the volatility in TSMC's stock comes amid broader uncertainty in the semiconductor sector, with concerns about demand cycles and geopolitical tensions. The company's ability to maintain its technological leadership and manage capacity expansion will be critical factors in the coming months.
As the market digests the recent swings, investors will be closely monitoring the October sales figures due out next week for early signs of whether the company is on track to meet its ambitious fourth-quarter targets. The rebound on Friday offers some relief, but the road to full recovery remains uncertain.
