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TSMC predicts robust growth, boosts US chip tool stocks

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Goldman, Morgan Stanley ( MS ) rise after results

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Indexes: Dow up 0.6%, S&P 500 up 0.3%, Nasdaq up 0.3%

(Updates close with volume, share moves)

By Caroline Valetkevitch

NEW YORK, Jan 15 (Reuters) - U.S. stocks rose on

Thursday after two days of declines as Morgan Stanley ( MS ) and

Goldman Sachs ( GS ) shares shot up following upbeat quarterly results,

while Taiwan-based chipmaker TSMC's blockbuster results boosted

shares of ‌U.S. chipmakers.

Goldman Sachs ( GS ) and Morgan Stanley ( MS ) both reported

a rise in quarterly profit, helped by a flurry of dealmaking.

Shares of Goldman rose 4.6%, giving the ​Dow its biggest boost,

and Morgan Stanley ( MS ) gained 5.8%.

Earlier this week, other banks reported mixed results

that weighed on the ‍sector, along with worries about U.S.

President Donald Trump's proposed one-year cap that would ⁠limit

credit-card interest rates to 10%.

Investors ⁠are still buying stocks that are undervalued

compared with tech, said Jake Dollarhide, chief executive

officer of Longbow Asset Management in Tulsa, Oklahoma.

"It's been growth, ‌tech or bust in this market," in recent

years, he said. ​Today, "it's the banks and old-school

industrials" that are standouts. The S&P 500 industrials index

notched a closing record high again.

Tech stocks also rose, led by chipmakers. The world's

main producer of advanced artificial ⁠intelligence chips, TSMC

, predicted robust annual growth and flagged ‍more U.S.

manufacturing capacity ​was in the works. U.S.-listed shares of

TSMC jumped 4.4%.

An index of semiconductors climbed 1.8%. Shares

of Nvidia ( NVDA ), Broadcom ( AVGO ) and chipmaking tool

company Applied Materials ( AMAT ) all climbed.

The Dow Jones Industrial Average rose 292.81

points, or 0.60%, ‍to 49,442.44, the S&P 500 gained 17.87

points, or 0.26%, to 6,944.47 and the Nasdaq Composite

gained 58.27 points, or 0.25%, to 23,530.02.

With tech, "there was some worry as far as valuations - that

they were getting a little too far ahead of themselves," said

Alan Lancz, president of Alan B. Lancz & Associates Inc., an

investment advisory firm, based in Toledo, Ohio.

"That's been kind of squashed this morning with the news

from Taiwan Semiconductor."

Richly valued tech and growth stocks have lost ​some momentum

recently as ‍investors kicked off the year by chasing bargains.

Both mid-caps and the small-cap Russell 2000

have been outperforming the S&P 500 so far this year. The

Russell 2000 reached a closing record high.

The equal-weighted S&P ​500 has risen about 4%

since the end of December versus an increase of 1.4% for the S&P

500.

Among other financial companies, BlackRock ( BLK ), the

world's largest asset manager, gained 5.9% after a rally in

markets lifted fee income and pushed its assets under management

to a record $14.04 trillion in the fourth quarter.

Results from the banks essentially have kicked off the

fourth-quarter U.S. earnings season. The season picks up steam

next week with a more diverse group of companies set to report.

Volume on U.S. exchanges was 19.12 billion shares, compared

with ​the 16.81 billion average for the full session over the

last 20 trading days.

Advancing issues outnumbered decliners by a 1.92-to-1

ratio on the NYSE. There were 759 new highs and 55 new lows on

the NYSE.

On the Nasdaq, 2,683 stocks rose and 2,137 fell as

advancing issues outnumbered decliners by ‍a 1.26-to-1 ratio.

(Additional reporting by Medha Singh and Pranav Kashyap in

Bengaluru; Editing by Shinjini Ganguli, Maju Samuel and David

Gregorio)