Taiwan stock market achieves second-largest gain in history in 2023

Taipei, Dec. 29 (CNA) Taiwan's main stock exchange, which ended trading for 2023 on Friday, closed up 26.7 percent for the year as a whole, and gained NT$12.73 trillion (US$416.2 billion) in market capitalization.

On Friday, the Taiex, the Taiwan Stock Exchange's benchmark weighted index, rose 20.44 points to close at 17,930.81, up 3,793 points or 26.7 percent from its 2022 close.

The full-year gain of 3,793 points in 2023 overtook the 3,596-point gain in 2009 to become the second-largest annual increase in the Taiex's history, trailing only the 4,505-point leap in 1989 when the exchange was just getting started.

The year's gains came after the Taiex fell in 2022 by 22.4 percent, or 4,081 points, the second biggest points fall in the index's history, after a 5,094-point fall in 1990.

Tech stocks

The primary driver behind the surge in market capitalization in 2023 was contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC), whose market value increased by approximately NT$3.7 trillion.

IC designer MediaTek Inc., whose share price surpassed NT$1,000 this week after having remained below that level for 21 months, saw its market capitalization rise by NT$640 billion.

That was followed by Quanta Computer Inc., a major artificial intelligence (AI) server maker, whose market capitalization grew by NT$558.9 billion in 2023.

On Friday, the Taiex hit a high of 17,945 and closed at 17,930.81, the highest intraday and closing levels, respectively, since early March 2022.

2024

Looking ahead to the first quarter of 2024, fund manager Wei Yung-hsiang (魏永祥) said the market is focusing closely on whether the Federal Open Market Committee meeting of the United States Federal Reserve in January will hint at an interest rate cut.

A rate cut signal could lead investors to anticipate a lowering of the value of the U.S. dollar and move toward invest in non-dollar-denominated assets, including in Asian markets.

Based on fundamentals, Wei said, with adjustments of excessive inventories seemingly near an end and the anticipated recovery in end-user economic conditions, the profits of listed Taiwanese companies are expected to post double-digit growth.

Coupled with the traditional bullish market trend in the first quarter and policy incentives, the outlook for the market is promising, he said.