Taiwan Stocks Rebound and Reclaim 20-Day MA, But Trading Value Drops Below NT$800 Billion! Experts Bullish on Electronics Seasonal Rally

Taiwan stocks opened higher today (20th) but then entered a period of consolidation. The market closed up 214.39 points, or 0.48%, at 44,933.74, regaining the 20-day moving average after losing it earlier. However, trading value further declined to NT$793 billion, marking the lowest level since the end of July.

According to post-market data, the three major institutional investors recorded a net sell of NT$3.537 billion on the centralized exchange. Foreign investors bought NT$3.782 billion, investment trusts sold NT$121,100, and proprietary traders sold NT$6.108 billion.

Kuo Hsiu-cheng, Head of Index Quantitative Investment at Dahua Bank Asset Management and manager of the Dahua Yuli High Dividend 30 (00918), pointed out that Taiwan's listed and OTC companies posted record-high revenues in July, indicating the industry has officially entered the traditional peak season for electronics. Among technology stocks, core sectors including substrate boards, optical communications, thermal solutions, memory, ASICs, packaging and testing, AI server assembly, passive components, and power components remain fundamentally sound, with some possessing pricing catalysts, attracting active bargain hunting. Meanwhile, non-electronics sectors such as biotechnology, bicycles, container shipping, thermal solutions, and domestic consumption have also played roles in defense and turnaround hedging.

Looking ahead, Kuo believes the long-term global trend of AI development remains unchanged, with Taiwan's semiconductor and server supply chain standing as the greatest tangible beneficiaries. Amid market volatility as the broader index retests the 20-day line, investment strategies should balance "long-term growth momentum" with "high dividend defensive strength."

For example, 00918 targets constituents with high ROE profitability and high historical dividend payout rates. Its core holdings comprehensively cover AI server assembly leaders (Wistron, ASUS, Quanta, Gigabyte), major PCB and substrate board manufacturers (Kinpo Electronics, JSP), as well as stable-earning financial conglomerates and high-yield shipping leaders (Evergreen, Yang Ming, Wan Hai, Hi-Yang-KY, Hsin Chong).

Kuo stated that through high-quality portfolio construction, 00918 helps investors withstand short-term volatility and precisely capture dual-return potential—dividend payouts and capital gains—during the seasonal rally in the second half of the year.