Shares in Taiwan posted their fourth steepest point fall yesterday, plunging about 1,500 points, with market sentiment spooked by spiking international crude oil prices amid the US-Israel war with Iran.
The TAIEX closed down 1,489.12 points, or 4.43 percent, at 32,110.42 after foreign institutional investors sold a net NT$120.82 billion (US$3.8 billion) of shares, the largest daily net sale in history, Taiwan Stock Exchange (TWSE) data showed.
Selling was seen across the board before some bargain hunters emerged as the TAIEX fell below 32,000 points to cap the losses. However, yesterday’s point fall was still the fourth-largest on record after 2,065.87 on April 7 last year, 1,807.21 on Aug. 5 in 2024 and 1,494.77 on March 3 this year, TWSE data indicated.
Photo: EPA
The New Taiwan dollar lost NT$0.242, or 0.76 percent, to close at NT$31.920 per US dollar, Taipei Forex Inc data showed.
Other Asian stock markets plunged yesterday as investors, already spooked by concerns over extended tech valuations and the huge spending on artificial intelligence (AI), ran for cover after crude oil prices soared 30 percent to their highest levels since the Russian invasion of Ukraine in 2022.
Seoul, which had been the best performer this year thanks to a tech rally, tumbled more than 8 percent at one point before closing 6 percent down, while Tokyo shed more than 5 percent. Hong Kong, Shanghai, Sydney, Singapore, Manila, Bangkok, Mumbai, Jakarta and Wellington also took hits.
With crude prices passing US$100 a barrel, “panic selling followed on stock markets at home and abroad. The geopolitical unease has triggered a systemic crisis,” Moore Securities Investment Consulting Co (摩爾投顧) analyst Adam Lin (林漢偉) said.
“A spike in crude prices has raised fears over inflation and the global economy,” Lin said. “So, tech stocks fell victim to the sell-off, plunging the broader market.”
Contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC,台積電) shed 4.23 percent to close at NT$1,810, smartphone chip designer MediaTek Inc (聯發科) lost 5.57 percent to end at NT$1,665 and chip packaging, AI server maker and iPhone assembler Hon Hai Precision Industry Co (鴻海精密) lost 5.61 percent to close at NT$210.5.
In contrast, shares in container shipper Yang Ming Marine Transport Corp (陽明海運) rose 1.48 percent to close at NT$61.6 and rival Wan Hai Lines Ltd (萬海航運) gained 3.18 percent to end at NT$81, as the war has led to higher shipping fares.
As the TAIEX dropped 2,070.28 points or 6.16 percent at one point yesterday, Deputy Minister of Finance Frank Juan (阮清華), who serves as executive secretary of the National Stabilization Fund, said the authorities were closely monitoring the local stock market, the war in the Middle East and shipping traffic in the Strait of Hormuz.
Juan said that major stock markets across the world are declining, and that the fall on Taiwan’s stock market is smaller than that of Japan and South Korea.
Taiwan’s economic fundamentals are still strong and demand for AI remains robust, with TSMC serving as a crucial guide for investors, he said. If necessary, the fund would convene an emergency meeting to discuss crisis measures, he added.
Additional reporting by AFP
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