TAIPEI (Taiwan News) — Taiwan's stock market rallied on Wednesday (Sept. 25) in early trading after Taiwan Semiconductor Manufacturing Company (TSMC) shares rose in the US.

TSMC's American Depositary Shares (ADS) climbed 4.13% on Tuesday. This pushed its Taiwan-listed shares above NT$1,000 (US$31) at the market's open Wednesday, per CNA.

The increase in TSMC's ADRs directly impacted the Taiwanese stock market. The broader Taiwan Stock Exchange Capitalization Weighted Stock Index (TAIEX) jumped 298.1 points to 22,729.88 at 9:02 a.m., marking a 2-month high.

Smaller-cap stocks also saw gains. The three largest weighted stocks all rose in early trading.

TSMC went up to NT$18, reaching NT$1,005. Foxconn climbed NT$4.5 to NT$187.5, and MediaTek increased by NT$35 to NT$1,230.

Institutional investors attribute the market's rally to the Federal Reserve's recent interest rate cut. Lower interest rates generally boost economic activity and encourage investment.

However, concerns about a potential economic recession remain, as evidenced by the unexpected drop in the US Consumer Confidence Index released Tuesday. Furthermore, the upcoming US presidential election adds additional uncertainty to the market.