AI boom powers Taiwan, South Korea to record market caps, reshaping global equity rankings

A powerful surge in artificial intelligence-linked stocks is rapidly transforming equity markets in Asia, with Taiwan and South Korea emerging as dominant forces in global market rankings.

Taiwan’s stock market capitalisation has climbed to a record $4.5 trillion, overtaking Canada and recently surpassing the UK, marking a historic shift in global equity positioning. The rally has been driven largely by semiconductor giants such as Taiwan Semiconductor Manufacturing Co. (TSMC), which continues to benefit from soaring global demand for AI hardware.

The benchmark TAIEX index also crossed the 40,000 mark for the first time, reflecting strong investor optimism and sustained foreign inflows. Over the past 12 months, Taiwan’s market value has surged by nearly $2.7 trillion, a staggering 150 per cent increase, positioning it as a potential contender to overtake India as the world’s fifth-largest equity market in the near term.

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Meanwhile, South Korea’s equity market has followed a similar trajectory, reaching a record $4.1 trillion in market capitalisation. The country’s benchmark Kospi index has rallied sharply, supported by gains in tech heavyweights like Samsung Electronics and SK Hynix, both of which are deeply embedded in the global AI supply chain.

Collectively, the two markets have added approximately $4.6 trillion in value over the past year, underscoring the scale of the AI-driven transformation underway in Asia.

Despite Taiwan’s relatively smaller economy compared to major global peers, its outsized role in semiconductor manufacturing has made it a key proxy for AI demand. As global investment in artificial intelligence accelerates, analysts expect continued capital inflows into these markets, further strengthening their position in the global financial ecosystem.