The Bad PlaceUS Top News and Analysis | Asia's trillion-dollar titans are powering — and distorting — its fastest growing stock markets
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Asia’s two biggest equity markets are soaring on the back of a handful of AI‑linked semiconductor giants, raising alarm over the risks of extreme concentration. Taiwan’s Taiex has risen to record highs with Taiwan Semiconductor Manufacturing Co. (TSMC) now making up more than 40 % of the index, while South Korea’s Kospi has jumped over 80 % this year as Samsung Electronics and SK Hynix together account for a record 42 % of the benchmark. Analysts warn that this reliance on a narrow export‑driven sector makes both markets vulnerable to supply‑chain disruptions, geopolitical tensions, a slowdown in data‑center spending, and higher energy costs, while also inflating valuations that could unwind if the AI hardware boom falters; nevertheless, South Korea’s broader industrial base – including shipbuilding, defense and “K‑culture” – gives its rally a slightly more diversified underpinning than Taiwan’s, which is increasingly tied to TSMC and global semiconductor demand.
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