Opened Lower and Fell Over 700 Points, Rebound Lasts Only One Day
Taiwan stocks opened at 47,014.87 points on the 29th, then opened lower and moved lower, at one point plunging over 760 points intraday. As of 10:49 a.m., the Weighted Index was at 46,303.67 points, down 731.91 points, or 1.56%. Excluding TSMC (2330), the index fell 1.96%, showing selling pressure had spread from heavyweights to other stocks, and the 939-point rebound rally of the previous day was difficult to sustain.
Alphabet Earnings Spark AI Investment Concerns
Google parent Alphabet reported third-quarter revenue up 25% year-on-year to US$127.6 billion, with core search business revenue of about US$63.35 billion, both slightly below expectations. Although Google Cloud revenue surged 103% to about US$30.7 billion, third-quarter free cash flow was negative US$9.07 billion, its second consecutive quarter in negative territory, and the company warned that 2027 capital expenditure will increase substantially, sparking market concerns over AI investment costs and returns. After the earnings release, Alphabet shares plunged about 10% in after-hours trading, dragging on Nasdaq futures and Asian technology stocks. Asian markets weakened in tandem, with Korea's KOSPI turning negative intraday, down 3.17% to 5,821.84 points, while Japan's Nikkei 225 narrowed its gains to 64,035.39 points, up 0.13%.
Margin Balances Up NT$8.9 Billion, Taiwan Dollar Depreciates Past NT$32.5 Again
Concerns emerged on the筹码 front. According to TWSE statistics, margin balances in the centralized market increased NT$8.913 billion to NT$632.3 billion the previous day, a single-day increase of about 1.43%, while short-sale balances decreased by about 24,700 lots to 193,000 lots, showing the strong rebound attracted margin buying, leaving short-term leveraged positions facing adjustment pressure. On the foreign exchange market, after closing higher for two consecutive trading days, the New Taiwan dollar turned weaker again intraday. As of 11 a.m., the US dollar against the New Taiwan dollar was at NT$32.517, down 9.9 cents or about 0.31% from the previous close of NT$32.418, depreciating past the NT$32.5 mark again. The central bank noted that from October 12 to 16, foreign investors sold a net US$19.402 billion in Taiwan stocks and posted net outflows of US$17.961 billion, driving the New Taiwan dollar down 1.37% over the same period.
Analysts: Watch 5-Day Moving Average and Currency Moves
Senior analyst 王映亮 said that although Korean stocks plunged intraday, they have not fallen below their previous low, looking more like a normal pullback after a sharp rally. Investors should not panic excessively over Alphabet's weak earnings, and could instead use Taiwan stock volatility to look for stocks with solid fundamentals whose prices have already corrected significantly. Senior analyst 周佳和 noted that in the short term, besides watching whether the New Taiwan dollar can turn from depreciation to appreciation, investors must also watch whether the Weighted Index can reclaim the 5-day moving average within the next two days and hold it at the close. If it can hold, the weak momentum could have a chance to reverse, and battered quality stocks can be accumulated in batches. Conversely, if it remains capped by the 5-day line, the market remains in weak consolidation, and a conservative wait-and-see approach is advisable to avoid entering too early.