Taiwan Stocks Plunge Again! Exchange Clarifies Adequate Overall Maintenance Margin, Will Take Stabilization Measures if Necessary

Impacted by international tensions and a correction in tech stocks, Taiwan's stock market plunged 1,564 points today (29th), marking the seventh-largest point drop in history, narrowly holding above the 40,000-point threshold. The Taiwan Stock Exchange (TWSE) stated that credit transaction collateral levels remain adequate and cautioned investors against excessive panic based on individual stock maintenance margins. Driven by strong demand for AI and high-performance computing, domestic exports, corporate revenues, and profits have all achieved record highs. The outlook for full-year economic growth remains positive, with fundamentals remaining solid. The TWSE advised investors to carefully assess long-term corporate value. It also emphasized that it will closely monitor market developments and, if necessary, coordinate with regulatory authorities to implement stabilization measures.

Today (29th), major Asian stock markets declined in tandem. The Taiwan Weighted Index closed at 40,039.18 points, down 1,564.18 points (3.76%). However, the index is still up 38.24% year-to-date, outperforming other major Asian markets. Market liquidity remains robust, with the daily average trading value on the centralized market exceeding NT$1 trillion since the beginning of the year.

Recently, market attention has focused heavily on collateral maintenance margins and margin call situations in credit transactions. The TWSE explained that, according to the 'Operational Guidelines for Securities Firms Handling Securities Financing and Short-Selling,' the maintenance margin for credit transactions is calculated on an overall account basis (including both financing and short-selling), covering both listed and over-the-counter securities. Therefore, margin call and liquidation ('forced selling') situations cannot be determined by the maintenance margin of a single stock alone. There is no concept that a stock's financing maintenance margin falling below 130% automatically triggers a forced sale. Moreover, the individual stock financing maintenance margin data cited in the market does not account for additional collateral deposits. Investors should carefully evaluate such data before using it to predict market trends.

As of yesterday (July 28), the overall maintenance margin for unrestricted loans across the entire market remained far above the regulatory margin call threshold of 130%, indicating sufficient collateral levels. However, investors should refer to the actual overall maintenance margin provided by their securities firms for their individual accounts when assessing margin call and liquidation risks.

In response to rapid market changes, the TWSE urges investors to carefully assess their own risk tolerance and base investment decisions on corporate earnings, industry prospects, and long-term investment value, rather than believing unverified misinformation or market rumors. The TWSE will continue to urge listed companies to promptly and fully disclose material information, enhancing the timeliness and transparency of disclosures to protect investor rights and maintain market order.

The TWSE reported that total revenue for all listed companies in June 2026 reached NT$5.481 trillion, a 44.71% year-on-year increase. Cumulative revenue for the first six months of the year totaled NT$29.1955 trillion, up 35.93% from the same period last year. Listed companies' pre-tax net profit in the first quarter reached NT$1.8634 trillion, a 59.88% year-on-year increase, reflecting the steady growth momentum of listed firms.

Looking ahead, Taiwan's Directorate General of Budget, Accounting and Statistics (DGBAS), Central Bank, Academia Sinica, and Taiwan Institute of Economic Research have all revised their economic growth forecasts for 2026 (ROC Year 115) upward to 9.64%, 9.45%, 10.16%, and 10.38%, respectively. This reflects continued support from AI demand and strong export performance. Recent earnings briefings from leading listed companies also indicate sustained growth in demand for AI, high-performance computing, and advanced processes. For example, TSMC has raised its full-year revenue growth forecast and capital expenditure, continuing to expand its advanced process capacity—demonstrating the industry's strong confidence in the medium- to long-term potential of these sectors.

The TWSE will closely monitor international political and economic developments and market trading conditions, ensuring fair, orderly, and transparent trading. It will continue urging listed companies to promptly disclose material information and encourage them to buy back treasury shares at appropriate times, considering their financial health, cash flow, corporate credit, and shareholder interests. Should the stock market experience irrational consecutive declines or significantly increased volatility, the TWSE will cooperate with regulatory authorities and implement stabilization measures as needed to maintain stable market operations.