NVIDIA's Good News Fuels Rally in Stocks and Currency; NTD Rises for 2nd Day, Returns to 31.5 Level

(CNA, by Pan Tzu-yu, Taipei, 21st) Stellar earnings from NVIDIA eased investor concerns about the Middle East situation, prompting a return of capital to risk assets and fueling a rally in both stocks and the currency market. The Taiwan stock market recorded its fifth-largest closing point gain, and the New Taiwan Dollar (NTD) rebounded in sync against the US dollar, closing today at 31.595, an appreciation of 4.8 cents. This marked its second consecutive day of gains. Total turnover in the Taipei and Yuanta foreign exchange markets reached 2.1875 billion USD. Conflict in the Middle East had led to persistently high international oil prices, causing major central banks to adopt a more hawkish stance, suggesting that interest rate hikes could not be ruled out amid resurgent inflation. As financial market uncertainty grew, the Taiwan stock market underwent a correction after a strong run since mid-May, with the NTD weakening alongside it, even breaking below 31.7 during yesterday's trading session. Today, the market sentiment shifted significantly. US President Trump's statement that US-Iran negotiations are "in the final stages" caused a drop in international oil prices. Combined with the positive earnings report from AI giant NVIDIA, this triggered a return of hot money, leading to a counter-offensive in both stock and currency markets. The Taiex staged a retaliatory rebound, sparked by large-cap stocks and passive component stocks, with the index at one point soaring 1586.09 points, its third-largest intraday point gain. It ultimately closed at 41368.21, up 1347.39 points. The NTD opened at 31.61 against the US dollar, with an intraday high of 31.561 and a low of 31.63. Compared to the powerful rally in the stock market, which posted its fifth-largest closing point gain, the NTD's appreciation was relatively moderate. A foreign exchange trader explained that with foreign investors having been net sellers of Taiwan stocks for several consecutive days, the currency market still had to absorb substantial selling pressure from outflows. Although foreign investors turned to be net buyers of over NT$60 billion today, the inflows and outflows in the forex market limited the currency's ascent. The trader noted that since the beginning of May, the NTD has first appreciated and then depreciated, but the exchange rate has remained within the 31.300 to 31.700 range, fluctuating mainly with news developments and foreign investor movements. In the short term, the focus will be on whether the Taiex continues to rise, attracting foreign capital inflows to support the NTD, as well as on developments in the Middle East conflict and inflation trends. (Editor: Chang Chun-mao) 1150521