Shares in Taiwan Semiconductor Manufacturing (NYSE: TSM) rose 11.7% in the week to the close of trading on Thursday, according to data provided by S&P Global Market Intelligence. The overwhelming bulk of the move came after an excellent set of earnings delivered before the opening of trading on Thursday.

Investors closely follow the semiconductor sector because it tends to be "early cyclical." When manufacturers and other chip customers are preparing to ramp up production in anticipation of future growth, the first thing they do is order more semiconductors. And since semiconductor companies discuss this with customers, the chip companies tend to have an early read on the economy's direction.

As such, investors would have taken heart from management's guidance and commentary on the earnings call.

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Source Fool.com