Why Is Taiwan's Stock Market Rising Alone? 38 'Thousand-Dollar Stocks' in the Green — Experts Reveal the Domestic Capital Support Mechanism: Hold the Line, and It Can Surge Higher

During the volatile summer of this year, global stock markets experienced significant fluctuations, while Taiwan's stock market maintained a resilient upward trend in early August. On August 6, the Taiwan Weighted Index opened higher but closed down 214.90 points (-0.48%) at 44,396.70, showing a 'price-down, volume-down' pattern. Despite this, the 'Big Three Institutional Investors' — foreign investors, domestic funds, and proprietary traders — collectively bought NT$4.562 billion worth of stocks.

Financial expert Huang Shih-tsong, appearing on the program 'Bao-Jie Dian-Bing,' analyzed that domestic capital is the key force supporting the Taiwan stock market. According to Huang, strong buying activity in mid- and small-cap stocks during the latter part of the trading session helped limit the index's decline to just 0.48%.

In contrast, South Korea's market plunged 4%, and Japan's Nikkei fell 0.93%. Taiwan's market stood out for its resilience. Huang pointed out that the Taiwan index is currently holding above its 20-day moving average (quarter-line), which is acting as a technical support. However, due to the lack of global market alignment, Taiwan has not yet broken out to new highs.

Huang emphasized that among the 48 'thousand-dollar stocks' (shares priced above NT$1,000), as many as 38 advanced on the day. Stocks like United Biomedical, Phison Electronics, Fushida, Lien Yu Metal-Creation, Innodisk, Winward, Gaody, and Twinhead closed at their daily trading limits. Notably, Chuan Lu even became a 'ten-thousand-dollar stock' (above NT$10,000), drawing significant market attention.

This, Huang said, indicates a strong return of large-scale domestic capital. 'Foreign investors may be hesitant to go all-in, but domestic investors, especially large institutional players, are aggressively buying,' he stated.

Huang also highlighted the outperformance of individual Taiwanese stocks amid global weakness. For example, while Japan's Kioxia dropped 10%, Taiwan's memory firms Macronix and Phison hit their upper limits. Similarly, while Nittobo and Ibisaki Electric declined, Taiwan's Elite Material reached its limit-up, and Taiming and Taipower also rose.

He explained that although foreign investors are selling due to global market pressures, local institutional and domestic capital in Taiwan are stepping in to support the market. 'Foreign selling is being absorbed by strong domestic buying, creating a stable foundation,' Huang noted.

Looking ahead, Huang predicted that 'as long as the Taiwan market holds the quarter-line, it will eventually gain support from global markets and surge higher.' He advised investors to remain patient, maintain positions, and prepare for the next upward wave driven by domestic capital strength.