Asian chip stocks have experienced a notable surge, leading to fresh record highs for Taiwan's Taiex and South Korea's Kospi indices. This positive market reaction comes in the wake of the U.S.-Taiwan Initiative on 21st-Century Trade, the first agreement of which was signed in June 2023 and came into effect on December 10, 2024. The deal encompasses commitments on various trade-related aspects, including customs administration, good regulatory practices, services domestic regulations, anti-corruption measures, and support for small and medium-sized enterprises. Financial markets across Asia have been buoyed by optimism surrounding the artificial intelligence (AI) sector and robust earnings reports from major chip manufacturers like Taiwan Semiconductor Manufacturing Co. (TSMC). The recent performance has pushed tech-heavy indices in both Taiwan and South Korea to all-time highs. For instance, the Taiex achieved a record high on January 16, 2026, driven by strong tech sector performance. Similarly, the Kospi has seen significant gains, with reports on January 16, 2026, confirming it too hit fresh records. These movements underscore growing investor confidence in the region's semiconductor industry and its pivotal role in global technology supply chains. However, the trade deal continues to draw strong opposition from Beijing, with China reiterating its firm stance against any official agreements between the United States and Taiwan, urging Washington to adhere to the one-China principle. This geopolitical tension remains a significant factor influencing regional dynamics.