The global financial map is undergoing a seismic shift as the artificial intelligence (AI) boom and a massive semiconductor supercycle propel Asian markets to historic heights. In a stunning realignment of global equity rankings, South Korea and Taiwan have leapfrogged traditional heavyweights like the United Kingdom and Canada in total market capitalization. Driven by an insatiable demand for AI hardware, these two tech-heavy economies are now being recognized as the primary “backbone” of the global AI supply chain.
The primary engine behind this rally is the unprecedented capital expenditure from U.S. “hyperscalers.” Major cloud service providers, including Google, Amazon, Microsoft, and Meta, have proposed an aggregate capital expenditure of $725 billion for 2026, a staggering 77% increase year-on-year. This flood of investment is directed toward enhancing AI infrastructure, directly benefiting the manufacturers of the high-performance chips and memory required to power next-generation Large Language Models.
Taiwan’s benchmark index, the Taiex, recently made history by closing above the 40,000-point mark for the first time. The island’s total market value has surged by approximately $2.7 trillion over the last 12 months, reaching $4.5 trillion. This growth allowed Taiwan to overtake the UK two weeks ago and, more recently, surpass Canada’s $4.4 trillion valuation.
This dominance is largely anchored by Taiwan Semiconductor Manufacturing Co. (TSMC), which accounts for over 40% of the market’s total value. As the world’s largest contract chipmaker, TSMC is the primary beneficiary of AI infrastructure spending, with its 2-nanometer chip capacity expected to grow at a compound annual rate of 70% through 2028.
Simultaneously, South Korea has surpassed the UK, hitting a record $4.1 trillion in late April, eclipsing the UK’s $4 trillion. The benchmark Kospi has broken past 6,900 points, led by memory-chip giants Samsung Electronics and SK hynix, which together command over 40% of the index’s weight.
The surge is fueled by a “supplier’s market” in memory chips, where prices for DRAM and NAND flash have seen triple-digit growth as manufacturers prioritize high-bandwidth memory (HBM) for AI servers. Furthermore, government-led “Value-up” corporate governance reforms have bolstered investor confidence, attracting sustained structural capital inflows.
In contrast, the UK’s FTSE 100 and Canada’s markets remain dominated by traditional sectors such as financials, consumer staples, and energy. While these markets have seen modest gains, they lack the “high-octane” growth associated with AI innovation.
Analysts suggest that while European and North American stalwarts struggle to scale innovation, the structural rebalancing toward Taiwan and South Korea reflects a new global order where AI hardware dominance dictates market supremacy. At the current pace, Taiwan is positioned to potentially overtake India as the world’s fifth-largest market as soon as next month.
