Taiwan’s stock market closes above 35,000 after Lunar New Year break

On Feb. 25, Taiwan’s benchmark stock index continued its post-Lunar New Year rally, reaching fresh record highs and hitting over 35,000 points as strong domestic fundamentals and global tech demand underpinned investor confidence.

A strong post-holiday start

Taiwan’s stock market roared back after the nine-day Lunar New Year holiday from Feb. 14 to Feb. 22. On Wednesday, Feb. 25, the Taiwan Stock Exchange Capitalization Weighted Stock Index (TAIEX) climbed sharply, closing up 2.05% or 712.25 points at 35,413.07, surpassing 35,000 points for the first time, with turnover exceeding NT$818 billion (approximately US$26.13 billion.)

Large cap technology and electronics stocks led the charge, with memory and semiconductor shares in particular drawing buying interest on expectations of robust global demand, especially for AI-related hardware.

The rally was largely driven by Taiwan Semiconductor Manufacturing Company (TSMC), whose shares hit NT$2,025 and closed at NT$2,015 on Feb. 25, hitting the NT$2,000 benchmark for the first time. Its market capitalization surpasses US$2 trillion and is now ranked sixth in the world. 

Accounting for more than 40% of the market’s total capitalization, TSMC alone contributed approximately 540 points to the TAIEX’s advance.

Market drivers and investor sentiment

AI-driven demand such as memory chip and semiconductor firms continued to outperform, benefiting from sustained global demand for AI infrastructure and advanced computing applications.

For instance, DRAM manufacturer Nanya Technology, a corporation dedicated to the R&D, design, manufacturing, and sales of DRAM, closed up 3.11% at NT$298.

Winbond Electronics, a Taichung-based corporation that produces semiconductors and several types of ICs, surged more than 6%. Lin, a retired managing director from the financial sector told TCN that she bought Winbond stocks at around NT$20 in 2025 and it is now NT$122.

Macronix International, an integrated device manufacturer in the non-volatile memory market, rose 9.66% to close at NT$113.5.

As of February, despite renewed concerns about US tariff policy and broader geopolitical tensions, Taiwan’s market has shown an ability to absorb external headwinds and maintain momentum.

Historical patterns: The “Lunar New Year Effect”

Taiwan’s post-Lunar New Year strength is not an isolated 2026 phenomenon but part of a well-documented pattern. Historical data show that Taiwan’s stock market has a high probability of opening higher after the Lunar New Year holidays.

According to Yahoo, over the past decade the market rose on the first trading day after the Lunar New Year holiday in about 70% of years, excluding years such as 2025, 2020 and 2017 when seasonal uncertainties were particularly elevated.

Based on data compiled over the past 15 years, Yahoo concluded that average returns during the first 20 trading days after Lunar New Year were about 3.2%.

Analysts often attribute this pattern to several factors: domestic institutional investors rebalancing portfolios after year-end, improved risk appetite following an extended break, and renewed trading activity as global markets resume operations following the lunar holidays.

Market outlook and risks

The overall economic momentum remains robust, Global Views Monthly stated, fueled in particular by accelerating demand for AI applications. Capital expenditure and capacity deployment continue on an assertive trajectory, factors that may provide sustained tailwinds for Taiwan’s equity market.

However, United Daily News, citing Chief Economist of Taishin Financial Holdings Li Chen-yu (李鎮宇), cautioned that Taiwan’s traditional industries have seen their competitive edge erode, most notably in the machine tool and apparel sectors.

External uncertainties are also amplifying market volatility, Li said. Geopolitical and macroeconomic risks such as heightened tensions between the US and Iran may cause fluctuations in both the global and Taiwanese stock markets.