The TAIEX plunged 3.57 percent to close at 7,342.96 yesterday on the back of heavy falls in Europe and Wall Street overnight, as fears over a new global recession deepened, driving investors across Asia to dump shares.
That made Taipei the second-worst performer in Asia after South Korea’s 6.22 percent drop, one day after Morgan Stanley painted the US and Europe as “dangerously close to recession” and Taiwan cut its GDP growth forecast to 4.81 percent for this year, from the 5.01 percent estimated last month.
“The economic landscapes at home and abroad look increasingly rugged ahead,” Schroders Investment Management Taiwan vice president Tony Chen (陳同力) said.
Photo: Reuters
The dimming outlook will feed investor jitters and drag the main index lower until European and US equity markets show signs of stabilization, he said.
“The confidence crisis, warranted or not, may develop into a self-fulfilling prophecy and hurt companies as well as the economy,” the analyst said. “Many firms’ shares are undervalued.”
Hua Nan Securities Co (華南永昌證券) chairman David Chu (儲祥生) also said Taiwan was following the international trend and local stocks were not likely to rebound unless the problems in the international markets were resolved.
Turnover reached NT$120.96 billion (US$4.18 billion) with losses nearly across the board, as more -foreign funds pulled out, Taiwan Stock Exchange statistics indicated.
Foreign investors sold a net NT$5.79 billion in local shares, while proprietary dealers and trust firms slashed a net NT$2.69 billion and NT$1.09 billion respectively, based on stock exchange data. That helped push the local currency down to a four-month low against the US dollar.
The New Taiwan dollar closed at NT$29.076 in Taipei trading yesterday, the weakest since April 18, according to central bank data.
Altogether, the TAIEX shed another 3.85 percent, or 294.06 points, in a week that saw foreign players unloading a net NT$37.76 billion in local shares, the Taiwan Stock Exchange said, adding that net -selling totaled NT$201.96 -billion so far this month.
In an attempt to calm the market, Government Information Office Minister Philip Yang (楊永明) reiterated yesterday that the nation’s economic fundamentals remained healthy despite the market turmoil.
Vice Premier Sean Chen (陳冲), who also chairs the National Stabilization Fund, called a meeting of economic and financial officials in the morning, but concluded that the situation did not merit intervention.
Blue-chip names led the tumble, as shares in HTC Corp (宏達電), the world’s No. 5 smartphone brand, closed down by the daily limit to NT$719, while shares in Largan Precision Co (大立光), Taiwan’s largest handset lens-maker, sank equally to NT$776, Taiwan Stock Exchange data showed.
JPMorgan Asset Management (摩根富林明投信) analyst James Yeh (葉鴻儒) said the TAIEX has yet to hit bottom and investors should be cautious.
Yeh suggested cutting holdings in technology shares because the sluggish recovery in the West would weaken the earnings of export--focused manufacturers.
ADDITIONAL REPORTING BY CNA
AIR DEFENSE: The Norwegian missile system has proved highly effective in Ukraine in its war against Russia, and the US has recommended it for Taiwan, an expert said The Norwegian Advanced Surface-to-Air Missile Systems (NASAMS) Taiwan ordered from the US would be installed in strategically important positions in Taipei and New Taipei City to guard the region, the Ministry of National Defense said in statement yesterday. The air defense system would be deployed in Taipei’s Songshan District (松山) and New Taipei City’s Tamsui District (淡水), the ministry said, adding that the systems could be delivered as soon as the end of this year. The US Defense Security Cooperation Agency has previously said that three NASAMS would be sold to Taiwan. The weapons are part of the 17th US arms sale to
INSURRECTION: The NSB said it found evidence the CCP was seeking snipers in Taiwan to target members of the military and foreign organizations in the event of an invasion The number of Chinese spies prosecuted in Taiwan has grown threefold over a four-year period, the National Security Bureau (NSB) said in a report released yesterday. In 2021 and 2022, 16 and 10 spies were prosecuted respectively, but that number grew to 64 last year, it said, adding that the Chinese Communist Party (CCP) was working with gangs in Taiwan to develop a network of armed spies. Spies in Taiwan have on behalf of the CCP used a variety of channels and methods to infiltrate all sectors of the country, and recruited Taiwanese to cooperate in developing organizations and obtaining sensitive information
BREAKTHROUGH: The US is making chips on par in yield and quality with Taiwan, despite people saying that it could not happen, the official said Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) has begun producing advanced 4-nanometer (nm) chips for US customers in Arizona, US Secretary of Commerce Gina Raimondo said, a milestone in the semiconductor efforts of the administration of US President Joe Biden. In November last year, the commerce department finalized a US$6.6 billion grant to TSMC’s US unit for semiconductor production in Phoenix, Arizona. “For the first time ever in our country’s history, we are making leading edge 4-nanometer chips on American soil, American workers — on par in yield and quality with Taiwan,” Raimondo said, adding that production had begun in recent
Seven hundred and sixty-four foreigners were arrested last year for acting as money mules for criminals, with many entering Taiwan on a tourist visa for all-expenses-paid trips, the Criminal Investigation Bureau (CIB) said on Saturday. Although from Jan. 1 to Dec. 26 last year, 26,478 people were arrested for working as money mules, the bureau said it was particularly concerned about those entering the country as tourists or migrant workers who help criminals and scammers pick up or transfer illegally obtained money. In a report, officials divided the money mules into two groups, the first of which are foreigners, mainly from Malaysia
RSS