Taiwan's chip and materials makers are riding an AI-driven boom, but the wider Taiwan market is wobbling at record highs — good for suppliers tied to AI servers, risky for buyers chasing hot stories.

• Iteq, which makes the copper-clad boards used in servers, saw August profit jump more than eight times from a year earlier and hit its daily price limit as thousands of buy orders queued up.
• Demand for low-loss, high-speed board materials from AI servers, high-performance computing and new networking switches is outstripping supply, letting makers raise prices.
• AUO surged on reports it will move into advanced packaging with Intel and TSMC, then sold off hard as foreign investors took profits.
• The broader Taiwan index slipped back below 48,000, with TSMC and Hon Hai falling while MediaTek and Delta rose.
• Taiwan's imported inflation is biting too — it grows only a third of its food and imports over 90% of its energy, so higher oil and feed costs are pushing up restaurant and grocery prices.

Outlook: Ahead of the Trump-Xi meeting, where chip controls and AI security are expected on the table, Taiwan's AI supply chain stays the main driver — though record index levels and holiday profit-taking point to choppy trading near term.