The TAIEX took a beating yesterday, closing down 380 points and erasing all of Tuesday’s gains, as investors locked in the previous session’s profits from the bellwether electronics sector, dealers said.
Market sentiment remained cautious due to a rate hike cycle launched by the US Federal Reserve to fight inflation, so selling spread to old economy stocks, in particular the transportation sector, where several major shipping stocks are traded, pushing the main board even lower, dealers said.
Global stock markets and oil prices also hit the skids yesterday as worries about rising interest rates and recessions persisted.
Photo: CNA
The enthusiasm that saw Wall Street post its best day in more than a month on Tuesday suddenly evaporated as Europe opened 1.5 percent lower and Brent crude prices plunged 4 percent following what had also been a downbeat Asian session.
In Taipei yesterday, the TAIEX closed down 380.89 points, or 2.42 percent, at 15,347.75. Turnover totaled NT$278.532 billion (US$9.35 billion), with foreign institutional investors selling a net NT$22.44 billion of shares on the main board, Taiwan Stock Exchange data showed.
The sell-off wiped out the main board’s Tuesday gain of 361.06 points, or 2.35 percent.
Japan’s benchmark Nikkei 225 yesterday shed 0.4 percent to close at 26,149.55. Australia’s S&P/ASX 200 lost 0.2 percent to 6,508.50, South Korea’s KOSPI fell 2.7 percent to 2,342.81, Hong Kong’s Hang Seng dropped 2.6 percent to 21,008.34, while the Shanghai Composite index sank 1.2 percent to 3,267.20.
“Despite a rally on Tuesday, the [TAIEX] remained technically unstable after a recent slump, as market sentiment remained haunted by concerns over a rate hike by the Fed, which is expected to continue to drain funds out of the region for US dollar-denominated assets,” MasterLink Securities Corp (元富證券) analyst Tom Tang (湯忠謙) said. “There are growing concerns that an aggressive rate hike cycle will hurt the economy.”
Before Tuesday’s rebound, the TAIEX had tumbled about 1,300 points, or 7.82 percent, over the past eight trading sessions, meaning the main board was technically fragile, dealers said.
“In addition, investors witnessed Dow futures dipping again now, pointing to an ugly opening of the spot market later today, so they simply shifted to the sell side to take their money and run, avoiding possible losses tomorrow,” Tang said.
Fed Chairman Jerome Powell was yesterday due to start testifying at the US Congress. Investors would be looking for further clues about whether another 75 basis-point rate hike is on the cards for next month.
Economists polled by Reuters expect the Fed to deliver a 75-basis-point interest rate hike next month, followed by a 0.5 percentage-point rise in September.
They said the Fed is unlikely to scale back to 0.25 percentage-point rate hikes until November at the earliest.
Most other global central banks face a similar situation, apart from the Bank of Japan, which last week pledged to maintain its policy of ultra-low interest rates.
Minutes from the Bank of Japan’s April policy meeting released yesterday showed the central bank’s concerns about the impact the plummeting currency could have on the country’s business environment.
Vincent Wei led fellow Singaporean farmers around an empty Malaysian plot, laying out plans for a greenhouse and rows of leafy vegetables. What he pitched was not just space for crops, but a lifeline for growers struggling to make ends meet in a city-state with high prices and little vacant land. The future agriculture hub is part of a joint special economic zone launched last year by the two neighbors, expected to cost US$123 million and produce 10,000 tonnes of fresh produce annually. It is attracting Singaporean farmers with promises of cheaper land, labor and energy just over the border.
US actor Matthew McConaughey has filed recordings of his image and voice with US patent authorities to protect them from unauthorized usage by artificial intelligence (AI) platforms, a representative said earlier this week. Several video clips and audio recordings were registered by the commercial arm of the Just Keep Livin’ Foundation, a non-profit created by the Oscar-winning actor and his wife, Camila, according to the US Patent and Trademark Office database. Many artists are increasingly concerned about the uncontrolled use of their image via generative AI since the rollout of ChatGPT and other AI-powered tools. Several US states have adopted
KEEPING UP: The acquisition of a cleanroom in Taiwan would enable Micron to increase production in a market where demand continues to outpace supply, a Micron official said Micron Technology Inc has signed a letter of intent to buy a fabrication site in Taiwan from Powerchip Semiconductor Manufacturing Corp (力積電) for US$1.8 billion to expand its production of memory chips. Micron would take control of the P5 site in Miaoli County’s Tongluo Township (銅鑼) and plans to ramp up DRAM production in phases after the transaction closes in the second quarter, the company said in a statement on Saturday. The acquisition includes an existing 12 inch fab cleanroom of 27,871m2 and would further position Micron to address growing global demand for memory solutions, the company said. Micron expects the transaction to
A proposed billionaires’ tax in California has ignited a political uproar in Silicon Valley, with tech titans threatening to leave the state while California Governor Gavin Newsom of the Democratic Party maneuvers to defeat a levy that he fears would lead to an exodus of wealth. A technology mecca, California has more billionaires than any other US state — a few hundred, by some estimates. About half its personal income tax revenue, a financial backbone in the nearly US$350 billion budget, comes from the top 1 percent of earners. A large healthcare union is attempting to place a proposal before
RSS