Taiwan Stocks End 291.69 Points Lower as TSMC Drops NT$40

By Sophie Lindqvist

In the session on the 2nd, Taiwan’s Weighted Index closed at 44,920.14, down 291.69 points, or 0.65%, after an early 812.73-point plunge pushed it below 45,000 and a late recovery failed to restore that level.

The index opened at 45,034.53 and fell to 44,399.10. Bargain buyers then lifted it to a session high of 45,156.17, a roughly 757-point rebound from the low. Profit-taking returned before the close. Turnover reached NT$758.8 billion, about US$23.3 billion.

How severe was the selloff and rebound?

U.S. technology weakness supplied the opening shock. The Nasdaq and Philadelphia Semiconductor Index fell on the previous Friday as investors questioned AI capital spending and the returns those outlays might produce.

TSMC’s ADR dropped US$25.68, about NT$840, or 5.95%, to US$406.13, roughly NT$13,000. Taiwan index futures fell 867 points overnight, triggering another wave of selling.

Taiwan stocks had already lost 1,156.5 points on Friday, closing at 45,211.83 on NT$877.73 billion turnover, about US$26.9 billion. Three major institutional groups then sold NT$139.844 billion, about US$4.3 billion, in net terms.

Foreign and mainland Chinese investors accounted for NT$112.467 billion of net sales, or about US$3.5 billion; proprietary traders sold NT$51.37 billion, about US$1.6 billion; investment trusts offset part of that with NT$23.993 billion of net purchases, roughly US$736.6 million.

Which semiconductor names absorbed the selling?

TSMC remained under pressure throughout the local session. Its NT$40 decline to NT$2,330, equal to 1.69%, made it the index’s main drag.

MediaTek rose NT$55 to NT$3,970, while Delta Electronics gained NT$20 to NT$1,355 after hitting the daily limit down on the previous Friday. Hon Hai added 2.24% to NT$251. MediaTek and Hon Hai together supplied nearly 50 index points.

That divergence matters. The index recovered because selected large caps rose, not because its principal chip heavyweight stabilized.

• High-turnover gainers: MediaTek, Delta Electronics, Nan Ya Plastics, Unimicron Technology, WIN Semiconductors, ASE Technology Holding, Nanya Technology, Elite Material and Fulltech Fiber Glass.
• High-turnover laggards: Global Unichip, Yageo, Kinsus Interconnect Technology, United Microelectronics, Iteq, Nan Ya PCB and Winbond Electronics.

Memory stocks traded mixed, financial stocks saw pronounced outflows, and PCB and CCL names diverged. Plastics, chemicals, optoelectronics, rubber, shipping, oil-gas-electricity and glass indexes all closed higher.

Is intervention changing the market?

Su Wei-yuan, a senior analyst, said investment trusts and government-affiliated funds had recently stepped in to absorb selling. He called that support a possible stabilizer, not proof that the decline has ended.

“Stabilizing prices first, then letting volume catch up” is acceptable, he said, because investors need not require price and volume to confirm each other immediately. His immediate test is whether key moving-average support holds and the decline stops widening.

Taiwan stocks have left lower shadows for three consecutive sessions, which points to buying support below. The source gives no detailed volume data to verify how broad that support is.

Technology market leader Aspeed Technology fell to NT$15,350, then reversed about NT$850 to around NT$16,200. Optical-lens leader Largan Precision rose NT$90, or 1.66%, intraday to NT$5,520. Those moves show selective technology buying, but they do not resolve the heavyweights question.

Can fundamentals withstand the political risk?

Capital Securities Investment Advisory cited robust AI demand and several records. The source reports that Taiwan’s business climate indicator logged a red reading for a tenth consecutive month in September, which the firm called a record best, while September export orders also reached a record high.

The firm expects this year’s economic growth to exceed 12% and calls the fundamentals supportive. That figure is a forecast, not a reported result. International political and economic disruption and the approaching U.S. midterms have kept the market weak and range-bound.

Currency markets offered no confirmation. The New Taiwan Dollar weakened by more than 2 jiao intraday, broke through 32.7 and touched a nearly three-week low. Stocks and currency have not stabilized in tandem, which adds uncertainty to any rebound.

Institutional investors place the key to halting the decline in heavyweight-stock performance and capital flows. With capital recently leaving heavyweights, they say flows should be watched first; TSMC’s 1.69% fall shows that pressure persisted.

What could determine the next rebound?

Voting in the U.S. midterm elections begins Tuesday U.S. time. Institutional investors expect a wait-and-see posture before results, with margin financing balances, chip-market settlement and renewed foreign buying as the main checkpoints.

Huang Yi-ting, chairman of First Securities Investment Advisory, said the move from July’s low to the early-October high of 49,969 had a 0.5-wave retracement “satisfaction point” near 44,676, comparable with the October 30 intraday low.

He called this week’s U.S. midterms the key market driver. Military action by the United States or Iran could lift oil prices and hinder stabilization; a shift toward communication and peace talks could speed the rebound, although Huang expects two to three weeks afterward to absorb selling pressure.

Su cited historical statistics showing a high probability of market gains after U.S. midterm votes: about 5%, 10% and 14% on average one, two and three months after the vote. Those figures are historical averages, not a forecast for this cycle, and election uncertainty may delay the return to fundamentals.

Third-quarter financial reports from Taiwan-listed and OTC companies now provide a more concrete test of corporate profits than the historical pattern.

The close above 44,900 was narrow, while 45,000 changed hands without holding and trading volume did not clearly expand. For now, TSMC and other heavyweights must stabilize and foreign selling must ease before the market can confirm more than a tactical rebound.