Foreign Investors Reduce Holdings in Popular Active ETFs, Sell Over NT$430 Billion in Taiwan Stocks in 5 Days

(Central News Agency, Taipei, 10th) Selling pressure emerged in tech stocks, causing the Taiwan Stock Exchange Capitalization Weighted Stock Index (TAIEX) to close at its lowest point of the day. The index fell 1,478.90 points to close at 43,225.54 points, falling below its monthly moving average of approximately 43,349 points. This marked the sixth-largest closing point drop in history. Trading value reached approximately NT$1.324093 trillion. The three major institutional investors (foreign investors, investment trusts, and dealers) recorded a combined net sell of NT$117.364 billion.

According to statistics from the Taiwan Stock Exchange, foreign and mainland Chinese investors (excluding proprietary desks of foreign investors) recorded a net sell of NT$93.574 billion on the day, the eighth-largest single-day net sell amount in history. This marked the fifth consecutive trading day of net selling, with cumulative net selling over the five days reaching a staggering NT$437.4 billion. Dealers also reduced holdings by NT$40.551 billion on the day. Only investment trusts were on the buying side, with net purchases of NT$16.761 billion.

In terms of individual stocks, the top three stocks sold by foreign investors on the day were: Uni-President Active Upgrade 50 (00403A) with 94,397 units, Cathay Financial Holding with 92,624 units, and Powerchip Semiconductor Manufacturing Corporation (PSMC) with 73,783 units. Another popular active ETF, Uni-President Active Taiwan Stock Growth (00981A), was also sold heavily, with 71,367 units sold, ranking fourth on the foreign investor sell-off list.

On the buying side, the top three stocks purchased by foreign investors on the day were: First Financial Holding with 30,117 units, Winbond Electronics with 27,744 units, and Chang Hwa Commercial Bank with 27,707 units.

Chang Chi-wen, Senior Vice President of the Strategy and Marketing Department at Nomura Investment Trust, analyzed that the TAIEX has been continuously hitting new highs over the past year, making a moderate correction a reasonable phenomenon. He observed that corporate earnings and economic growth momentum have not deviated from original expectations, and this volatility in the Taiwan stock market is not a reversal of fundamentals. However, valuations of some individual stocks have already priced in growth potential for 2027-2028. With changes in the interest rate environment, such overly forward-looking pricing may face corrections.

Chang believes that from the perspective of the Taiwan stock market's structure, AI remains the market's main axis. However, given the significant gains already made, the speed of sector rotation has noticeably accelerated, market willingness to chase prices has become more cautious, and operational difficulty has increased. He advises investors not to chase highs in the short term, to moderately adjust positions that have already gained profits, and to return to selecting targets based on industry fundamentals and medium-to-long-term growth potential. (Editor: Yang Lanxuan) 1150610