Taiwan Stocks Close Down 1057 Points, Breaking Below 5-Day Moving Average, Facing Battle to Defend 46,000 Points

(CNA) - The Taiwan stock market faced heavy selling pressure today, with the index plummeting over 1200 points intraday, influenced by sharp declines in US and South Korean semiconductor stocks and a correction in technical divergence. Although the decline did not further expand after midday, the upward momentum from buyers was limited. The market closed at 46043.60 points, down 1057.05 points, a drop of 2.24%, falling below the 5-day moving average of 46645 points. The transaction value was NT$1.453618 trillion.

The semiconductor index saw a heavier decline today, closing down 3.43%. The electronics index fell 2.63%, and the financial index closed 2.08% lower. Among traditional industries, the plastics index moved against the trend, rising 3.68% by the close.

Key electronic stocks faltered, becoming major casualties. TSMC closed down NT$100, or 4.02%, at NT$2390, falling below its 5-day moving average of NT$237. MediaTek dropped 5.51% to close at NT$4285. Memory chip manufacturers Winbond and Nanya Technology fell 3.07% and 2.42% respectively, closing at NT$205 and NT$443.5.

Under the theme of transformation, the two major panel manufacturers continued to attract capital. Innolux rose 5.15% to close at NT$69.4, and AUO gained 4.99% to close at NT$30.5. Their trading volumes were as high as 1.09 million and 890,000 shares, respectively.

UMC, a wafer foundry reportedly collaborating with Intel, rose 4.71% to close at NT$178, with a trading volume exceeding 560,000 shares, ranking fifth in trading volume.

The number of high-priced stocks above NT$1000 decreased to 51. Motech Industries and GlobalWafers both fell out of the NT$1000 club, closing down 5.75% and 4.46% at NT$999 and NT$965, respectively.

Senior analyst Tsai Ming-han told CNA that the market is digesting profit-taking selling pressure in the semiconductor sector, which is a technical pullback triggered by a significant rise, not a trend reversal. The panic in the early trading of the Taiwan stock market primarily stemmed from the rapid pullback in Micron Technology's stock price after a sharp rise. However, this phenomenon is common around earnings reports or investor conferences, and there has been no substantial change in fundamentals.

Tsai Ming-han further pointed out that the current market habit is to "buy on dips," providing effective support for the index. However, this also implies that selling pressure may intensify if the market experiences a significant pullback in the future. (Editor: Chang Liang-chih) 1150624

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