TAIPEI (Taiwan News) — Taiwan's stock market saw significant movement Friday as the weight of Taiwan stocks in the UK Financial Times Stock Exchange 100 Index was adjusted during its rebalancing.
As a result, major Taiwan exchange-traded funds with assets exceeding NT$100 billion (US$3.06 billion), such as the Yuanta/P-shares Taiwan Top 50 ETF (0056). The Fubon FTSE TWSE Taiwan 50 ETF (006208) also rebalanced their portfolios.
This rebalancing led to trading volume surpassing NT$100 billion in the final session, placing downward pressure on the index, which dropped by approximately 188 points, per CNA and Commercial Times.
An ETF is a basket of stocks. For example, the 0056 invests in the top 50 companies by market capitalization in Taiwan's weighted index. As the FTSE rebalanced, these ETFs also adjusted the companies in their portfolios.
The Taiwan Stock Exchange Capitalization Weighted Stock Index, TAIEX, closed down 422 points at 22,510.25, compared to a loss of 26.32 points last Friday. Turnover totaled NT$467.549 billion.
The electronics sector index declined by 2.14%. TSMC fell NT$35 to close at NT$1,035 (US$31.7).
TSMC's decline alone contributed to a drop of about 282 points on the TAIEX. Other major electronics stocks, including MediaTek, Delta Electronics, and ASE Technology Holding, also closed lower.
Traditional industry stocks generally fell, with Formosa Plastics, Nan Ya Plastics, and Formosa Chemicals & Fiber reaching new lows. The plastics sector index fell by 4.34%, while food, textiles, machinery, electrical engineering, cable, glass, paper, rubber, construction, and tourism all dropped by more than 1%.
Shipping company Yang Ming Marine Transport, newly added to the constituent stocks of the 0056, closed up 1.92% at NT$79.7. This also lifted the closing prices of the sector's Evergreen Marine and Wan Hai Lines.
The shipping sector index rose by 0.34%, showing relative resilience compared to other sectors.
Shin Kong Investment Trust Chairman Liu Kun-hsi (劉坤錫) said that market conditions are marked by quick sector rotations, with rallies in leading sectors lacking sustainability. Due to the weak upward momentum in the broader market, he anticipates the index will likely trade sideways.
