Weak US Tech Earnings Drag Taiwan Stocks
Alphabet's disappointing earnings report and surging AI spending weakened investor confidence, with all four major US stock indexes closing lower, wiping out nearly US$500 billion in market value. The Nasdaq fell 1.4%, and the Philadelphia Semiconductor Index ended a four-session winning streak, as funds rotated into other sectors. Meanwhile, weaker safe-haven demand pushed the US dollar index lower to around 101.6. Dragged down by this, Taiwan stocks remained weak, with the weighted index plunging 1,156.5 points on October 30, falling below the 46,000 mark. The three major institutional investors net sold a combined NT$139.844 billion, including NT$112.467 billion by foreign investors, the seventh-largest net sale on record, with a combined NT$181.283 billion sold over two consecutive days. In October alone, cumulative net sales reached as high as NT$994.317 billion.
New Taiwan Dollar Opened Below 32.6 but Reversed to Close Higher
The New Taiwan dollar against the US dollar opened below the 32.6整数关卡 on October 30, falling more than 1.8 jiao intraday, touching 32.676 at one point in early trading, down 1.84 jiao, showing one-sided weakness. Although exporters sold foreign exchange, the force was weaker than foreign capital outflows. The central bank monitored closely throughout the session, intervening multiple times against foreign selling, with sharp volatility before the close. Finally, under coordinated调节 by the central bank and exporters, the currency reversed course, closing at 32.478, up 1.4 cents, turning from negative to positive, with total turnover narrowing slightly to US$3.3955 billion. For the week, it rose a total of 3 cents, or 0.09%, with the weekly line turning positive, ending four consecutive weekly losses.
Depreciated 6.26 Jiao in Single Month, Monthly Line Falls for Two Straight Months
Looking back at the October trend, the New Taiwan dollar was still hovering around 31.7 at the beginning of the month. As Taiwan stocks fell and foreign investors remitted funds frantically, the exchange rate fell back to around 32.7 in the middle of the month. The central bank also rarely issued a statement during trading hours, emphasizing that Taiwan stocks were relatively resilient and that New Taiwan dollar volatility was stable relative to other major currencies. However, the funding impact was greater, as foreign investors continued to take profits. Despite the central bank's strenuous efforts, although the exchange rate barely held, it remained weak, depreciating 6.26 jiao in a single month, with the monthly line posting two consecutive monthly losses.
Market Focuses on 32.8 and Central Bank调节 Ahead
Bank dealers analyzed that the New Taiwan dollar was hit hardest by funding conditions, with foreign investors alone selling nearly NT$1 trillion in October, and the exchange rate retreating to its previous low, around 32.7. Amid continued market doubts about AI investment, the exchange rate may test the 32.8 mark. The central bank has frequently taken action to stabilize the exchange rate recently, but as amounts grow larger and daily depreciation approaches 2 jiao, whether the central bank has other调节 methods is drawing close attention.