TAIEX closes down 60.16 as international markets tumble

The Taiwan Stock Exchange opened low and continued to decline on Friday closing at 8687.63, down 60.16 points or 0.68% with a trading value of NT$90.81 billion.

The increasingly attractive OTC market only experienced a minimal decline of 0.15 points and closed at 146.07 with a trading value of NT$37.56 billion.
Dragged down by international markets, the TAIEX plummeted past 8700 to open the trading day at 8697.73 with a session high of 8709.56 and a low of 8677.81.

Changes in the eight major stock categories: cement stocks fell 0.7%, food stocks rose 1.7%, petrochemical stocks fell 1.2%, textile stocks fell 0.2%, machinery and electronics stocks fell 0.7%, paper and pulp stocks fell 0.3%, construction stocks fell 0.4%, and banking and financial stocks fell 0.6%.

Due to a number of external factors such as instability in the Ukraine and the slowdown in China’s economic development, the TAIEX winning streak ended after just recently surmounting the 8700 barrier.

Heavily weighted large cap stocks that led the market surge on Thursday including TSMC (2330), Delta Electronics (2308), UMC (2303), and Hon Hai (2317) all showed signs of weakness on Friday. Only high-priced blue chip bellwether stocks Largan Precision (3008), HTC (2498), and MediaTek (2454) held steady. The financial sector remained weak due to the continuing Cross-Strait Agreement on Trade in Services dispute.

Analysts indicated, though plunging international markets negatively impacted the Taiwan stock market, the OTC market was relatively unaffected. However, tensions between Russia and Ukraine will influence foreign investment as it relates to Taiwan stocks. Due to the volatile situation, any current investment decisions should be made with caution. In the short-term, investors can focus on the OTC market but risk must still be appropriately managed.

According to analyst assessments, the Taiwan stock market will continue to experience the effects of international affairs. If the TAIEX cannot rebound past 8700 quickly, it may first test the 8650 threshold. However, in anticipation of a rebound, investors’ sights can be set on fundamentally sound high yield stocks.

Updated : 2021-01-28 22:22 GMT+08:00