Global index provider MSCI Inc has lowered Taiwan’s weighting in two of its major indices, but upgraded it in another index after a semi-annual index review earlier this month.
MSCI said in a statement on Friday that it has cut Taiwan’s weighting in the MSCI Emerging Markets Index, which is closely watched by foreign institutional investors, by 0.08 percentage points to 14.12 percent.
It was the 11th consecutive quarter in which MSCI cut the nation’s weighting in the index.
MSCI also lowered Taiwan’s weighting in the MSCI All-Country Asia ex-Japan Index from 16.31 percent to 16.16 percent, while raising its weighting in the MSCI All-Country World from 1.68 percent to 1.69 percent.
The adjustments are to take effect after the market close on Nov. 30.
Following the index review, MSCI said it has decided to move intellectual property portfolio owner eMemory Technology Inc (力旺電子), high-speed transmission integrated circuit designer Parade Technologies Ltd (譜瑞科技) and uninterruptible power system solution provider Voltronic Power Technology Corp (旭隼科技) to the MSCI Global Standard Indexes, from the MSCI Global Small Cap Indexes.
Analysts said the inclusion of the firms in the global standard indices reflects their strong showing on the local equity market this year.
EMemory and Parade shares have risen about 81 percent and 14 percent respectively on the local over-the-counter market since the beginning of August.
Voltronic shares have risen 28.7 percent on the local main board during the period.
NAND flash controller designer Phison Electronics Corp (群聯電子), IC packaging and testing services provider Powertech Technology Inc (力成科技), and capacitor and resister supplier Walsin Technology Corp (華新科技) have been moved from the MSCI Global Standard Indexes to the MSCI Global Small Cap Indexes.
MSCI has also added seven other Taiwanese firms, including e-commerce solution provider 91APP Inc and automotive diode supplier Actron Technology Corp (朋程科技), to the Global Small Cap Indexes.
The number of constituencies in the MSCI Taiwan Index remained unchanged at 87, with 18 stocks having their weighting adjusted by the index provider.
EMemory had the largest weighting upgrade with 0.44 percentage points, while contract chipmaker Taiwan Semiconductor Manufacturing Co (台積電) saw its weighting fall to 45.01 percent, MSCI said.
MSCI said that India witnessed the largest weighting upgrade in the MSCI Emerging Markets Index with 0.16 percentage points.
EARLY TALKS: Measures under consideration include convincing allies to match US curbs, further restricting exports of AI chips or GPUs, and blocking Chinese investments US President Donald Trump’s administration is sketching out tougher versions of US semiconductor curbs and pressuring key allies to escalate their restrictions on China’s chip industry, an early indication the new US president plans to expand efforts that began under former US president Joe Biden to limit Beijing’s technological prowess. Trump officials recently met with their Japanese and Dutch counterparts about restricting Tokyo Electron Ltd and ASML Holding NV engineers from maintaining semiconductor gear in China, people familiar with the matter said. The aim, which was also a priority for Biden, is to see key allies match China curbs the US
The popular Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) arbitrage trade might soon see a change in dynamics that could affect the trading of the US listing versus the local one. And for anyone who wants to monetize the elevated premium, Goldman Sachs Group Inc highlights potential trades. A note from the bank’s sales desk published on Friday said that demand for TSMC’s Taipei-traded stock could rise as Taiwan’s regulator is considering an amendment to local exchange-traded funds’ (ETFs) ownership. The changes, which could come in the first half of this year, could push up the current 30 percent single-stock weight limit
NOT TO WORRY: Some people are concerned funds might continue moving out of the country, but the central bank said financial account outflows are not unusual in Taiwan Taiwan’s outbound investments hit a new high last year due to investments made by contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) and other major manufacturers to boost global expansion, the central bank said on Thursday. The net increase in outbound investments last year reached a record US$21.05 billion, while the net increase in outbound investments by Taiwanese residents reached a record US$31.98 billion, central bank data showed. Chen Fei-wen (陳斐紋), deputy director of the central bank’s Department of Economic Research, said the increase was largely due to TSMC’s efforts to expand production in the US and Japan. Investments by Vanguard International
‘SACRED MOUNTAIN’: The chipmaker can form joint ventures abroad, except in China, but like other firms, it needs government approval for large investments Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) needs government permission for any overseas joint ventures (JVs), but there are no restrictions on making the most advanced chips overseas other than for China, Minister of Economic Affairs J.W. Kuo (郭智輝) said yesterday. US media have said that TSMC, the world’s largest contract chipmaker and a major supplier to companies such as Apple Inc and Nvidia Corp, has been in talks for a stake in Intel Corp. Neither company has confirmed the talks, but US President Donald Trump has accused Taiwan of taking away the US’ semiconductor business and said he wants the industry back
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