Taiwan Stocks Plunge Below 40000
Taiwan stocks on Friday (11月6日) once collapsed more than 3700 points intraday, setting the largest intraday drop on record, and fell below the 38000 mark. The decline narrowed at the close to 1873 points, still below the 40000 mark, ending at 39701. For the whole week, it fell a total of 5510 points, down 12.2%. Investment guru "Old Bull" said on his Facebook fan page on 11月8日 that last Friday when opening brokerage apps, many people's reaction was to want to delete them. He noted the plunge was triggered by a selloff in US AI stocks, with Taiex futures net short positions surging to about 10萬口, and in his years of market experience, such a big weekly drop is truly uncommon. With US stocks rebounding last Friday, Taiwan stocks are expected to see a rebound on Monday.
Key Events This Week to Drive Market
Market watch items are intensive this week. On 11月9日 the short-selling curbs officially take effect, with the National Stabilization Fund supporting the market simultaneously; on 11月10日 TSMC will release October revenue, and that evening the US will release the Consumer Price Index (CPI); on 11月13日 the US will release the Producer Price Index (PPI). After the National Stabilization Fund decided to enter the market and the FSC imposed short-selling curbs, whether policy support can combine with stabilization in global markets will be key to whether the short-term market stops falling. Investors still need to do their homework and closely watch the rollout of the measures and changes in economic data.
Intervention Like a Tourniquet: Watch 3 Signals
Old Bull reminded that stabilization is more like a tourniquet — it cannot cure the illness. He said he will first watch 3 things ahead, including whether foreign-investor selling narrows, whether the NT dollar exchange rate can hold at 33, and whether margin financing positions have been washed out. Foreign-investor moves concern whether selling pressure eases, a stable exchange rate helps market confidence recover, and whether leveraged margin positions are effectively cleaned up relates to chip stability and the sustainability of a rebound. After last week's 12.2% plunge amid heavy bearish sentiment, the degree of improvement in these 3 chip and fund-flow signals will determine whether a rebound is fleeting or a gradual bottoming.
Back to Earnings to Check Fundamentals
The coming week also happens to be when listed companies release third-quarter earnings reports and October revenues in large numbers. He stressed that report cards matter more than a sea of green on the screen, because a 12% weekly stock price drop does not mean company profits fell 12% in a week. He advised investors to pull out the revenue and profit figures of holdings on hand — if they have not changed, do not be scared off by prices. If this wave of declines has left you unable to sleep, the problem may be oversized positions, and you should re-examine holding weights and risk tolerance to avoid letting emotions override discipline.