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TAIPEI (Reuters) -TSMC, the world's biggest producer of advanced AI chips, forecast fourth-quarter revenue up by as much as 24% as it rides an AI boom that saw it post its sixth consecutive quarter of double-digit profit growth, beating estimates. TSMC said it expects robust artificial intelligence demand to continue and maintained its forecast for capital spending at up to $42 billion for 2025, although it flagged a potential business impact from U.S. trade tariffs and currency moves. The Taiwan company, whose customers include Nvidia and Apple, posted a 39.1% jump in third-quarter net profit and said it would be prudent in its business planning going into 2026. Benefiting from surging demand for advanced chips used in AI applications, Taiwan Semiconductor Manufacturing Co said net profit for July-September climbed to T$452.3 billion ($14.76 billion). That was well ahead of a T$417.7 billion LSEG SmartEstimate drawn from 20 analysts. SmartEstimates are weighted toward forecasts from analysts who are more consistently accurate. TSMC said it believes the AI boom is strengthening and demand is stronger than what it had anticipated three months ago as it forecast next year to remain healthy due to robust demand for AI-related products. Trump's trade policies and threats to put tariffs on semiconductors have created uncertainty for the global chip industry and TSMC. TSMC announced plans for a $100 billion U.S. investment with Trump at the White House in March, on top of $65 billion pledged for three plants in the state of Arizona, one of which is up and running. On Wednesday, top semiconductor equipment maker ASML, for which TSMC is a major customer, said third-quarter bookings beat market forecasts but that it expected a significant fall in demand from China next year. Samsung Electronics said on Tuesday it expected its biggest quarterly profit in over three years, also thanks to the AI boom. Taiwan-listed shares in TSMC have risen 38% so far this year, largely brushing off concerns about tariffs, and ahead of the 20% rise for the broader market. ($1 = 30.6450 Taiwan dollars) (Reporting by Wen-Yee Lee, Faith Hung and Ben Blanchard; Editing by Christopher Cushing and Muralikumar Anantharaman)

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By Kevin Buckland TOKYO (Reuters) -Stocks rose across most of Asia on Thursday, with the chip sector buoyant following a strong rally among U.S. peers overnight and a robust start to Wall Street's earnings season also lifting the mood.  At the same time, simmering trade frictions between Beijing and Washington increased the appeal of safe havens such as gold – which renewed a record high – and undercut the dollar. Crude oil rose from five-month lows after U.S. President Donald Trump said Indian Prime Minister Narendra Modi had pledged his country would stop buying oil from Russia, which supplies about one-third of its imports. Japan's Nikkei advanced 1.2%, with chip- and artificial intelligence-related shares boosting the index. The momentum increased after Taiwanese chipmaker TSMC reported record earnings, while also benefiting from political developments that put fiscal dove Sanae Takaichi's bid to become Japan's prime minister back on track. Taiwanese share trading was already closed at the time of TSMC's announcement, ending the day up 1.4% and reaching a record. South Korea's KOSPI jumped 2.2% to its own record peak after the country's chief presidential policy adviser said he was "optimistic" about ongoing talks to finalise a trade deal with the U.S.  Australia's equity benchmark added 0.9% and also reached a record high with poor jobs data raising the odds of central bank easing.  However, Hong Kong's Hang Seng fell 0.7% and mainland Chinese blue chips were flat in a volatile session as investors pondered the path of trade ties with the U.S. European stock futures pointed 0.3% lower. U.S. stock futures were overall flat following a 0.4% gain for the S&P 500 and a 0.6% rise for the tech-heavy Nasdaq overnight. The Philadelphia SE Semiconductor Index surged 3%. "I remain of the belief that the longer-run path of least resistance continues to point firmly to the upside" for equities, said Michael Brown, senior research strategist at Pepperstone. "Though conditions have been choppy, I'd argue strongly that this is another of those occasions where the intraday price action largely represents noise." GOLD SURGE CONTINUES, DOLLAR DIPS Optimism over the AI narrative and signs of economic strength from robust U.S. bank earnings stole the spotlight for stock investors, even with Trump pronouncing late Wednesday that the U.S. is "in a trade war with China" – confirming what markets had already concluded from recent comments from both sides. Gold rose as much as 0.8% in the latest session to reach an unprecedented $4,241.77 per ounce. The dollar sagged for a third straight session, dropping 0.1% against a basket of major peers. It slipped as much as 0.4% to 150.51 yen, putting the psychologically key 150 line briefly in focus, although the pair bounced back to be flat ahead of the open of European markets. Part of that retracement came following news that ruling Liberal Democratic Party leader Takaichi was in talks with one of the opposition parties – the right-leaning Japan Innovation Party – for a partnership aimed at securing enough parliament votes to win the premiership in a vote likely to take place next week. The euro added 0.1% to $1.1657, and sterling rose 0.1% to $1.3412. There were some hopeful signs of calming trade tensions, with U.S. Treasury Secretary Scott Bessent saying an extension of the current tariff reprieve was possible, and that Trump still expected to meet Chinese leader Xi Jinping in South Korea later this month. "The brinkmanship between the U.S. and China hasn't dissipated yet," said Kyle Rodda, senior financial markets analyst at Capital.com. "It will only simmer down completely when the Chinese back off the threat of rare earth export curbs and the U.S. reverse the tariff hike to 100% slated for November 1. Until then, trepidation will remain in the markets." Trump's trade manoeuvres also lifted oil off five-month lows, with Brent crude futures up 0.8% at $62.41 a barrel and U.S. West Texas Intermediate (WTI) futures adding 0.9% to trade at $58.77. On Wednesday, the U.S. president said India would halt oil purchases from its top supplier Russia, and Washington would next try to get China to do the same as it intensifies efforts to cut off Moscow's energy revenues and pressure it to negotiate a peace deal in Ukraine. (Reporting by Kevin BucklandEditing by Shri Navaratnam)

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By Alun John, Dhara Ranasinghe and Stefano Rebaudo LONDON (Reuters) -France's financial markets are riding a roller-coaster, as the country grapples with one of its worst political crises in decades, and while sentiment is improving, the bumpy ride is not over.  French Prime Minister Sebastien Lecornu has promised to suspend a landmark pension reform until after the 2027 election, sacrificing one of President Emmanuel Macron's achievements to ensure the government's survival. He is facing no confidence votes in parliament Thursday but appears likely to survive. Here's a look at where markets stand, and what comes next.  BOND VIGILANTES IN HIDING? The gap between 10-year French and German bond yields, the premium investors require to lend to France, is around 77 basis points, down from almost 90 bps last week.  It could tighten towards 75 bps, said Citi's senior rate strategist Aman Bansal.   It narrowed as investors focused on political stability over long-term fiscal worries. Lecornu's plan to suspend pension reform means he'll likely stay in his job, avoiding snap elections, even if some parties have called a no-confidence vote for Thursday. RBC BlueBay Asset Management senior portfolio manager Kaspar Hense said the firm had closed out of its short position – a bet on price falls – in French bonds last week on expectations a political compromise would be found.  "Demand for OATs (French bonds) remains strong at these levels of real and nominal yields," said Reinout De Bock, head of European rate strategy at UBS.  RATINGS WATCH  French borrowing costs remain among the highest in the euro zone, and because suspending the key pension reforms keeps pressure on public finances, France is vulnerable to further ratings downgrades. Lecornu says the suspension would cost 400 million euros ($463 million) in 2026 and 1.8 billion euros in 2027. Without offsetting measures, France's debt-to-GDP ratio would fail to stabilise, analysts say. Goldman Sachs reckons permanent suspension of the pension reform would add 0.5% of GDP to the deficit by 2035, so debt as a share of GDP over the next decade stabilises closer to 130% compared to around 113% now.  Moody's, which rates France at Aa3 with a stable outlook, reviews its long-term rating on October 24.  "We expect some downgrade pressure but this is priced in by markets," said BlueBay's Hense. STOCKS SOAR  France's blue chip share index rose 2% on Wednesday, its best day since early May, but that's not much to do with politics — luxury giant LVMH surged 12% after results. French midcaps are up around 0.25% but have underperformed longer term, up 9% in the past two years, compared to 15% for the blue chip index, and 26% for the overall European benchmark.  And that could continue.  Claudia Panseri, chief investment officer at UBS Wealth Management France, said that even if politics stabilises, fiscal and political challenges would still hang over domestic stocks. "European investors may prefer to focus on more internationally diversified companies within the CAC 40, which are less exposed to domestic risks," she said. BANKS BOUNCE BACK  But politics does matter for French banks.  "Banks have been the most sensitive sector to the political situation in France, and the most (bond) spread sensitive as well," said Barclays head of European equities strategy Emmanuel Cau.  Higher spreads typically mean higher wholesale funding costs for banks, hurting profits.  Societe Generale, BNP Paribas and Credit Agricole shares jumped over 2% in early trade Wednesday before steadying, having underperformed other European banks and broader French stocks last week when Lecornu stepped down.  Societe Generale's share price has doubled this year and any underperformance in banks may present a buying opportunity.  EURO RECOVERS FROM A COLD  A stellar euro rally has been dented by the political turmoil and it too is expected to benefit from stability.  ING currency strategist Francesco Pesole said the euro was looking less "fragile" with the French/German bond spread below 80 bps, adding he was watching no-confidence motions. "If Lecornu survives the no-confidence vote, euro/dollar could edge higher and potentially build strong support around $1.160," he said. It's trading around $1.166, up 12% this year. ​ (Reporting by Alun John, Dhara Ranasinghe and Stefano Rebaudo; additional reporting by Lucy Raitano; Editing by Toby Chopra)

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