Taiwan Stocks Plunge 1,873 Points, Fall Below 40,000 Mark
Taiwan stocks faced heavy selling pressure today (6th), closing at 39,701.64 points, down 1,873.08 points, or 4.51%, with turnover expanding to 1 trillion 2,461.04 billion yuan. Qifa Investment Advisory analyst Guo Xianzheng noted that the expanded volume today was normal, mainly affected by the sharp U.S. stock selloff and a nearly 3,000-point drop in Taiex night futures, with margin-liquidation selling surging at the open. As many investors had insufficient margin maintenance ratios, more than 90% of stocks hit limit-down at the open, with about 1,500 stocks sold at the lowest point, creating a chain reaction from margin selling.
Midterm Elections and Data Center Policy Raise Concerns
Guo Xianzheng said the decline was linked to U.S. midterm election results and AI data center policy. The market had interpreted that after Democratic wins, electricity use and construction for AI data centers might be restricted, impacting related supply chains. However, the newly elected Texas governor later clarified in a media interview that he was not opposed to data centers, but hoped operators would fully communicate with local governments to avoid affecting residents' quality of life. The remarks slightly eased market concerns, with Taiwan stocks narrowing from an intraday plunge of over 3,700 points to finish down just over 1,800 points, leaving a lower shadow of nearly 2,000 points.
Pullback From High Tests Half-Year Moving Average Support
From a technical perspective, Taiwan stocks have pulled back from the recent high of 49,968.92 points, with the 21-day turning point coinciding with negative news. However, Guo Xianzheng believes today's test of the half-year moving average support is no reason for excessive pessimism. He noted that margin liquidations at the open, with 90% of stocks limit-down at the open, represented short-term clearing of chips, and as panic selling was digested, the decline clearly narrowed, showing buying support below.
Memory and Energy Stocks Relatively Strong
On the market, memory and energy, and IC design groups performed relatively strongly. Guo Xianzheng said two groups held up well today, namely energy stocks and the memory group. Among them, Guoshou, Lianjun and other energy stocks were relatively resilient, while Team Group, Apacer and other memory stocks posted gains on solid earnings this year, while ADATA held flat, with potential to become Taiwan stocks' savior ahead. On strategy, he advised avoiding AI concept stocks affected by U.S. data center policy concerns in the short term, but not selling low, including silicon photonics, PCB and other groups, avoiding panic selling at relatively low levels, and instead focusing on stocks not directly affected by data center policy, shifting allocation toward memory, energy stocks, and select IC design groups.