Taiwan Stocks Plunge Over 700 Points as AI's 'Big Three' Call for Slowdown! Analyst Warns: Beware These Two Sectors — They Could Fall Harder Than Traditional Industries

While AI development accelerates rapidly, safety concerns are also mounting. Dario Amodei, CEO of Anthropic, publicly urged AI companies to slow their development pace. His appeal has been endorsed by Elon Musk, CEO of Tesla, and Sam Altman, CEO of OpenAI. As these 'three giants of AI' collectively hit the brakes, both Taiwan and U.S. stock markets reacted sharply downward.

Today (the 14th), Taiwan's stock market responded with a steep sell-off, briefly plunging over 700 points during trading. Although the decline later narrowed, it closed down 322 points at 45,862. Trading volume reached only NT$630.918 billion, marking the third-lowest level this year.

Analyst Zhou Daiyun posted on Facebook, stating, 'The Ghost Month has officially ended, but it seems the ghost stories in the stock market aren’t over yet.' He emphasized that the synchronized slowdown announced by the three AI giants is not mere short-term rhetoric—it will directly revise market expectations for AI sector earnings and represents the biggest variable ahead of Mid-Autumn Festival.

Zhou highlighted two critical signals to watch this week: 'Can the strong AI-related sectors hold their support levels?' and 'Can foreign institutional buying momentum continue?' If either weakens, downside pressure will quickly intensify. Indeed, short-term positioning was already fragile, which explains why Taiwan's market saw consecutive sharp drops last Thursday and Friday.

Zhou pointed out that sectors such as AI servers and PCBs, which have surged recently, now trade at relatively high price-to-earnings ratios. Once capital begins adjusting long-term outlooks, profit-taking selling pressure could emerge suddenly, leading to declines far steeper than those seen in traditional industries. 'There’s no need to rush into full short positions, nor am I suggesting the entire market will collapse—but under no circumstances should you chase higher prices or average up at this level.'

Zhou stressed that the current risk-reward ratio is extremely poor. In a volatile market, reducing exposure at resistance zones is always more comfortable than enduring sharp pullbacks. Even if foreign institutional buying remains slightly bullish in the short term, a single news event can instantly flip market sentiment and positioning. 'In the period leading up to the Mid-Autumn Festival, markets tend to swing back and forth—red days lure buyers, black days spark panic. These are old tricks. Avoid one-sided bets and prioritize position management above all else.'

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