Taiwan Stock Market Drops 6,192 Points Since July; Foreign Investors Sell Over $80 Billion, Shifting to Financial Stocks

The Taiwan stock market (Taiex) fluctuated sharply by 1,751 points today (30th), opening under heavy deleveraging pressure from margin calls. The index dipped to 39,404.65 in early trading before closing down 105.88 points at 39,933.30, breaking below the 40,000-point mark. Total trading value reached TWD 1.1 trillion.

Foreign investors sold a net TWD 48.312 billion today, marking their third consecutive day of net selling. Combined, the three major institutional investors—foreign investors, domestic institutional investors (investment trusts), and proprietary traders—sold a net TWD 50.874 billion.

Financial stocks emerged as safe havens. Foreign investors increased positions in Hwatai Bank (5880-TW), E.Sun Financial (2884-TW), Taiwan Business Bank (2834-TW), and First Financial (2892-TW). Investment trusts favored Mega Financial (2886-TW), Cathay Financial (2882-TW),华南 Financial (2880-TW), and Yuanta Financial (2890-TW). The broader market closed lower, with electronics stocks down 0.34%—accounting for 79% of total trading volume—while financial and insurance stocks rose 1.49%, making up 2.7% of volume.

Since July, the Taiex has dropped 6,192.61 points. With month-end and week-end closing on tomorrow (31st), the market may record the largest single-month decline in history. During this period, foreign investors have sold a net TWD 806.481 billion, nearing the all-time monthly record of TWD 889.537 billion set in March.

The New Taiwan dollar closed at 32.454 against the U.S. dollar, depreciating by 8.8 cents. Trading volume totaled USD 2.26 billion. The currency opened at 32.380, reached a high of 32.361, and a low of 32.518 during the session.

Foreign investors sold TWD 48.312 billion, investment trusts bought TWD 12.665 billion, and proprietary traders sold TWD 15.227 billion. The three major institutions combined for a net sell of TWD 50.874 billion. In the futures market, foreign investors held 1,781 long contracts and 81,017 short open interest contracts.

Top foreign investor buys in the集中 market: Hwatai Financial, Winbond Electronics, EVA Airways, E.Sun Financial, Taiwan Business Bank, Uni-President, Sunny Life Insurance, First Financial, China Steel, Shanghai Commercial Bank.

Top foreign investor sells: United Microelectronics, Hon Hai Precision, AU Optronics, Quanta Computer, D-Link,旺宏 Electronics, Sino Petrochemical, Compal Electronics,南亞 Plastics, Formosa Chemicals.

Top investment trust buys: Dah Chong Hong, King Yuan Electronics, Powertech Technology, Mega Financial, Cathay Financial, 华南 Financial, Unimicron, 南亞 Plastics, Yuanta Financial, Chroma ATE.

Top investment trust sells: Winbond Electronics, Yageo*, United Microelectronics, Hoshintron, LITE-ON, Zhen Ding-KY, TPC Wire & Cable, Nanya Technology, Nippon Electric Works, Goldtek Electronics.

Top proprietary trader buys: First Financial, Chang Hwa Bank, Sunny Life Insurance, Mega Financial, 华南 Financial, Capital Securities, Taishin & Shin Kong Financial, TSMC, CTBC Financial, ASE Holding.

Top proprietary trader sells: Yageo*, Innolux, Nanya Technology.

Senior securities analyst Jane Chien noted: "Today’s market showed a rebound after deep losses, but due to messy margin debt levels, the index remains volatile. The OTC market has seen larger declines, indicating pressure to unwind speculative positions in small- and mid-cap stocks. Technical indicators and volume trends remain unfavorable for bulls. Weak stocks may see short-term rebounds, but caution is advised. Investors should rebalance weak holdings and avoid aggressive buying until positions are cleaned up and global markets stabilize."