Taiex sees biggest point fall in history over U.S. economy fears

Taipei, Aug. 2 (CNA) Shares in Taiwan registered their steepest point fall in history Friday as steep declines in high cap electronics shares reflected concerns over the United States economy and uninspiring earnings reports, dealers said.

The Taiex, the Taiwan Stock Exchange's benchmark weighted index, ended down 1,004.01 points, or 4.43 percent, at 21,638.09 after moving between 21,636.22 and 22,141.20. Turnover totaled NT$517.18 billion (US$15.79 billion).

The 1,004.01-point drop at the close was the largest in Taiex history, surpassing the previous declines of 774.08 points on April 19 2024, and 752.63 points on July 26, 2024.

The plunge came after major falls in U.S. markets overnight, with the Dow Jones Industrial Average tumbling by more than 500 points, or about 1.2 percent, and the tech-heavy Nasdaq losing 2.3 percent on Thursday.

Those falls and the plunge in Taiwan on Friday were driven by relatively disappointing earnings reports from major U.S. tech companies and concern over a potential recession amid fears that the U.S. Federal Reserve has waited too long to lower interest rates.

One of the data points that spooked investors was the U.S. manufacturing index hitting its lowest point in July in eight months, dealers said, citing the Institute for Supply Management.

Taiwan Semiconductor Manufacturing Co. (TSMC), the most heavily weighted stock in the Taiex, fell 5.94 percent Friday to close at NT$903, resulting in a loss in market value of NT$1.47 trillion.

Contract manufacturing giant Hon Hai Precision Industry Co. fell 7.9 percent to end at NT$186.50.

Analysts were still optimistic at the market's prospects, however, as Taiwan's tech industry continues to grow.

Huang Yu-min (黃鈺民), an ETF fund manager at Taishin Securities Investment Trust, estimated that AI business opportunities will continue to drive Taiwan's IC design industry, with growth momentum expected to continue into 2025.