Opened Lower and Fell Further to Lose Half-Year Line
Taipei stocks on October 30 were hit by AI concerns triggered by U.S. tech earnings, with the weighted index opening lower and moving lower. It closed down 1156.5 points at 45211.83, a drop of 2.49%, with turnover of NT$8777.3 billion. Selling pressure expanded rapidly during the session, with the index at one point plunging 1642.07 points to an intraday low of 44726.26, falling below the 45000 mark and the half-year line in one move.
Foreign-Investor Adjustments Plus Margin-Call Washout
Senior analyst Chou Tai-yun pointed out that the recent pullback was mainly due to foreign investors adjusting futures and spot positions, while washing out leveraged margin balances built up during the earlier rally. Judging from the short-covering ratio, most selling pressure was passive, not long-term liquidation by institutions turning bearish, but rather margin-call selling by leveraged investors facing margin calls and forced liquidation, a chip-washing on the supply-demand front rather than a trend reversal.
Heavyweights a Drag but Small and Mid-Caps Hold Up
Although heavyweights such as TSMC and Hon Hai slumped and dragged down the index, small and mid-cap groups such as PCB and industrial PCs in the OTC market held their lows and refused to make new lows, becoming a hidden dividing line in the market. Chou Tai-yun believes Taiwan stocks' industry fundamentals have not reversed, and as the chip washout comes to an end, a short-term rebound is not far off, so investors need not scare themselves.
Five Straight Gains for Philadelphia Semiconductor Index, Asian Rotation Not Bearish
Looking at external markets, the Philadelphia Semiconductor Index has risen for five straight sessions, while U.S. chip stocks such as Nvidia remain firm, showing the long-term global AI chip story has not collapsed, and TSMC's overseas-related symbols also remain in a bullish pattern, with the current move only short-term profit-taking. In the same time zone, Hong Kong's Hang Seng Index rose strongly by more than 1%, while A-shares also climbed near midday, showing Asian assets are not collapsing across the board, but funds are rotating between regions.
Do Not Rush to Bottom-Fish, Strictly Control Margin Maintenance Ratios
Chou Tai-yun also reminded investors not to rush to go all-in to buy the dip, as high-P/E speculative stocks are correcting sharply without mercy, and the support logic for heavyweights cannot be blindly applied to small speculative stocks. Those holding margin positions must closely monitor maintenance ratios and should not hold out against margin calls, lest greed swallow profits amid volatility, and should distinguish between a trend reversal and a chip washout while carefully assessing risks.