Rattled by steep losses on markets in the United States overnight, investors in Taiwan sent the Taiwan Stock Exchange’s benchmark index, the Taiex, down to its lowest level in 13 months on Friday, ending a week in which the market lost nearly 5 percent.
Electronic shares, including chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC), were among the biggest losers, hurt by the bearish mood and by news that Samsung Electronics has temporary halted new orders and asked suppliers to delay or reduce shipments because of swelling inventories, according to Nikkei Asia.
The Taiex closed 1.25 percent lower at 15,641.26, and the day’s low of 15,573.38 was its lowest intraday level since May 17, 2021, when it hit 15,159.86.
Turnover, on the other hand, was up compared to recent sessions at NT$307.88 billion, after staying between NT$190 billion and NT$230 billion for much of the month.
U.S. interest rate hike
Alex Huang (???), an analyst with Mega International Investment Services Corp., said the U.S. Federal Reserve’s decision to raise its key interest by 0.75 percent earlier this week will lead to the reshuffling of asset allocations by investors in the short term, leading to some volatility.
The move also prompted conflicting views of where the global economy is headed, Huang said, resulting in an erosion in market confidence, and he warned that the Taiex’s movements would remain closely tied to the performance of U.S. markets.
On Friday, the Taiex fell more than 1 percent in the first minute of trading following a 2.42 percent plunge in the Dow Jones Industrial Average and a 6.24 percent fall in the Philadelphia Semiconductor Index overnight, and never recovered.
For the week, the Taiex lost 818 points, or 4.97 percent, and it has closed lower seven consecutive sessions.
TSMC, tech stocks
TSMC, the most heavily weighted stock on the market, announced on Thursday in the U.S. at its technology symposium that it would enter volume production of its 2-nanometer process in 2025, indicating that its new technology development was proceeding on schedule.
The positive lead was not enough, however, to overcome the 4.67 percent fall in TSMC’s American depositary receipts overnight and general fears of an economic slowdown.
Its stock hit an early low of NT$499 — the first time its share price had fallen below NT$500 since Dec. 4, 2020 — before rebounding slightly to close 1.38 percent lower at NT$501.00.
Overall, the electronics sector was down 1.49 percent and the semiconductor sub-index fell 1.80 percent.
Among other closely watched electronics stocks, chipmaker United Microelectronics fell 2.95 percent to close at NT$47.65, IC designer MediaTek closed 4.81 percent lower at NT$831.00, analog IC maker Silergy Corp. tumbled 5.83 percent to close at NT$2,260.00.
Hon Hai Precision Technology, the world’s biggest contract electronics manufacturer, fell 1.79 percent to NT$109.50, while camera lens maker Largan Precision closed 0.30 percent lower at NT$1,680.00.
Financials
Financial shares, which lost 1.45 percent on the day, and old economy shares, such as plastics, steel, and transportation stocks, were also generally down.
Fubon Financial Holdings ended down 1.78 percent at NT$60.80 and Cathay Financial Holdings closed 1.30 percent lower at NT$53.00.
Foreign institutional investors were net sellers of NT$23.77 billion in shares on Friday, according to Taiwan Stock Exchange data, ending a week in which they sold a net NT$113.91 billion in shares.
Source: Focus Taiwan News Channel