Taiwan Stock Market Pre-Market Report: 42,000 Level Holds as Foreign Selling Eases; High-End CCL Suppliers Signal Second Round of Price Hikes

On July 20, Taiwan's stock market attempted a rebound following the previous trading session's near-3,000-point plunge. The index briefly breached the 43,000-point mark but soon reversed, dropping as low as 41,967.75. The intraday range exceeded 1,100 points. The weighted index closed down 221.47 points, or 0.52%, at 42,449.7, with trading volume declining to NT$983.8 billion. While TSMC and Hon Hai posted gains, passive component stocks remained under heavy pressure.

The three major institutional investors collectively bought NT$2.174 billion worth of shares on the 20th. Foreign investors sold for the 12th consecutive session, but the net sell-off narrowed to NT$6.084 billion. Short positions in Taiwan stock futures dropped sharply by 7,852 contracts, bringing open short positions down to 78,337—the first time below 80,000 since July. Meanwhile, domestic trust investors continued to support the market, buying NT$14.649 billion worth of shares for the 19th consecutive session, totaling NT$202.5 billion in cumulative buys. Foreign and domestic investors took opposing positions in financial stocks such as Taishin and SK Life, while jointly adjusting positions in mature-process foundry stocks.

Reports from foreign brokerage circles indicate a new research note on Taiwan's copper-clad laminate (CCL) industry expects major CCL manufacturers to raise prices again by the end of Q3, with increases projected at 10–15%. A senior executive from a major CCL firm stated on the 20th that due to significant price fluctuations in raw materials such as glass cloth and copper foil, price hikes for second-half CCL products cannot be ruled out. However, PCB manufacturers on the demand side noted that the market is facing increasingly severe 'long-short material' imbalances, a trend neither side can afford to ignore.

The Taiwan weighted index experienced intense two-way trading on the 20th, holding above the 42,000-point level despite strong resistance above and support below. It closed down 221.57 points. The Taipei foreign exchange market also remained under pressure, with the New Taiwan dollar briefly depreciating past the 32.40 level. However, it rebounded in the final hour of trading, closing at 32.248, up 4 cents. The Taipei Foreign Exchange Brokers Association recorded a trading volume of US$2.471 billion, maintaining high turnover.

Electric arc furnace steelmaker Feng Hsing (2015-TW) announced its weekly pricing on the 20th. Despite a slight decline in international scrap steel prices, rebar prices had reached loss-making levels, prompting a NT$200 per metric ton price increase, halting two consecutive weeks of declines.

TrendForce (Ji Bang) released its late-July panel price forecast on the 20th, maintaining its estimate of a US$1–3 drop across all TV panel sizes, while monitor and notebook panels remained flat. TrendForce projected that notebook panel shipment momentum in Q3 would see a significant decline, potentially exceeding 15% quarter-on-quarter.

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