Taiwan Stock Market Bounces Back, But You're Still Not Out? Yuan Mu-Hsuan Reveals 'Retail Investor Disaster Zone': These 7 Financial Stocks Are Safe Havens

The Taiwan stock market experienced significant volatility in July, with two major crashes and a breach of the 40,000-point mark in the last week, before ending the last trading day with a surge of nearly 3,200 points. Investors felt like they were on a roller coaster, with heavyweight stocks like TSMC, Foxconn, and memory stocks becoming the focus of market sentiment and capital flows. Amid the panic among many investors, financial expert Yuan Mu-Hsuan posted on Facebook, stating that the reason investors felt such intense pain was that 'the decline in individual stocks was far greater than that reflected by the benchmark index.' Yuan Mu-Hsuan's analysis showed that the Taiwan stock market's current trend saw the weighted index hit a year-to-date high of 48,219 points on June 23, before falling to a low of 39,385 points on July 29, with a maximum correction of -18.3%. By July 31, it closed at 43,120 points, having rebounded approximately +9.5% from the low. However, the OTC index, representing mid and small-cap stocks, saw a maximum correction of 29% during the same period. Yuan Mu-Hsuan pointed out that among the top 100 market cap stocks listed on the TWSE and OTC, as many as 74 stocks had a larger decline than the overall index. The low points of individual stocks were concentrated between July 29 and July 30, in sync with the Philadelphia Semiconductor Index in the U.S., reflecting a global systematic sell-off in late July. On the other hand, seven financial stocks still hit new highs for the year on July 31, with corrections limited to intraday fluctuations. AI, Semiconductors Hit Hard! Multiple Benchmark Stocks Halved. Yuan Mu-Hsuan further listed the hardest-hit groups, primarily concentrated in semiconductors and the AI supply chain: Kuo Jie (-62.6%), Kang Xi (-58.5%), Li Wang (-58.3%), Lian Ya (-55.6%), Jin Xiang Electric (-55.4%), Ying Wei (-55.1%), and Shi Xin-KY (-53.4%). Additionally, the PCB/PCB substrate group, including Tai Yao, Hua Tong, Jian Ding, Nan Dian, Jing Shu, and Xin Xing, saw declines of over -40% across the board. Yuan Mu-Hsuan mentioned that in terms of electronic heavyweights, MediaTek fell -39.8%, Foxconn dropped -27.9%, and Delta Electronics corrected -44.9%; non-electronic disaster areas were relatively limited, with the deepest declines in commodities and shipping, such as Nan Ya (-41.1%), Yang Ming (-32.4%), and Formosa Plastics (-28.1%), but the magnitude was generally smaller than that of electronic heavyweights. Market Cap of 62 Trillion Supports! Capital Flows into Government Financial Safe Havens. Why was the overall index's decline limited to -18.3%? Yuan Mu-Hsuan emphasized that the key was TSMC's correction of only -14.0% (from a high of 2,535 yuan to a low of 2,180 yuan), using its massive market cap of over 62 trillion yuan to support the overall market, which is the main reason the index's decline was smaller than that of most individual stocks. On the other hand, the most resilient were government financial institutions and banks: Taipei Fubon Bank (-1.6%), Chang Hwa Bank (-3.3%), E.Sun Commercial Bank (-3.8%), Cathay United Bank (-4.0%), First Commercial Bank (-4.1%), Mega International Commercial Bank (-5.0%), and Hsinchu International Bank (-6.5%). The 'year-high day' for these seven financial stocks was July 31, representing a rush of capital into safe havens after a major decline, with the most recent day still setting a new high for the year. Defensive stocks also performed as expected, with Taiwan Power Company (-10.2%), Taiwan Mobile (-12.8%), Uni-President Enterprises (-11.6%), and Uni-President China Holdings (-8.8%). Telecommunications, food, and finance together contributed the majority of the 15 stocks with the shallowest declines. It was precisely because the index was propped up by heavyweights, while individual stocks experienced corrections of 40% to 60%, that the actual extent of the market's damage was far more severe than the surface situation of the overall index. More exclusive insider information from Wind Media: • Taiwan stock market volatility triggers FOMO sentiment! Yuan Mu-Hsuan reveals his trading strategy: Paper profits and gains of approximately 50 million this year • Taiwan stock market correction of less than 20%, but your assets are almost halved? Expert reveals the fatal flaw of retail investors: All short-term profits are given back • Is the recent plunge in Taiwan stocks just the beginning? Shih Chun-Chi warns of two storms brewing: TSMC could become a global ATM