Taiwan shares end down ahead of Powell's Jackson Hole speech

Taipei, Aug. 22 (CNA) Shares in Taiwan closed lower Friday as investors anxiously awaited a keynote speech planned by U.S. Federal Reserve Chair Jerome Powell at the annual economic policy symposium in Jackson Hole, Wyoming, later in the day, dealers said.

The Taiex, the weighted stock on the Taiwan Stock Exchange, ended down 197.66 points, or 0.82 percent, at the day's low of 23,764.47 after hitting a high of 24,071.65. Turnover totaled NT$359.38 billion (US$11.76 billion), compared with NT$420.67 billion on Thursday.

After rising 1.43 percent on Thursday, the Taiex extended momentum in the early Friday morning session before profit taking set in amid caution about the Fed's next move ahead of Powell's speech to push down large-cap tech stocks, in particular contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC), into the end of the session, dealers said.

"Investors held their breath before Powell speaks, hoping he will give more clues about how many times the Fed will cut its key interest rates by the end of this year," Concord Securities analyst Kerry Huang said.

"Such cautious sentiment kept many investors on the sidelines, sending turnover lower today," Huang said.

Huang said the bellwether electronics sector led the downturn, falling 0.93 percent, after TSMC, the most heavily weighted stock here, lost 1.30 percent to close at the day's low of NT$1,135.00. TSMC's losses contributed about 120 points to the Taiex's decline.

"Selling in TSMC came from concerns over uncertainty created by a reported plan that the Trump administration eyes a stake in the company," Huang said. "Investors just feared the U.S. government would come up with more measures to impact TSMC's operations."

On Wednesday, a Reuters report, citing unnamed sources, said the U.S. government planned to pursue equity in chipmakers that receive funding under the CHIP Act to build factories in the country, including TSMC.

TSMC's selling spread to other semiconductor stocks, with United Microelectronics Corp., a smaller contract chipmaker, falling 1.93 percent to end at NT$40.60, and application-specific integrated circuit (ASIC) designer Alchip Technologies, Ltd. shedding 2.51 percent to close at NT$3,190.000. However, smartphone IC designer MediaTek Inc. ended unchanged at NT$1,365.00.

Also in the tech sector, iPhone assembler Hon Hai Precision Industry Co. lost 1.70 percent to close at NT$202.40, but power management solution provider Delta Electronics Inc. rose 2.47 percent to end at NT$664.00.

"Nontech stocks largely moved in line with the broader market, but so-called 'military concept' stocks bucked the downturn after the government raised defense spending for 2026," Huang said.

Among the military concept stocks, drone maker Thunder Tiger Corp. rose 3.89 percent to close at NT$133.50, and fighter jet developer Aerospace Industrial Development Corp. gained 4.09 percent to end at NT$48.35.

On the other hand, Nan Ya Plastics Corp. lost 2.84 percent to close at NT$41.10, and Formosa Plastics Corp. lost 0.62 percent to end at NT$40.30.

In the financial sector, Cathay Financial Holding Co. lost 1.09 percent to close at NT$63.80, and Fubon Financial Holding Co. ended down 0.45 percent at NT$87.90.

"After Powell's speech, investors should watch closely how U.S.-based AI chip designer Nvidia Corp. will report its earnings and give guidance next week, which will move the U.S. markets," Huang said.

According to the TWSE, foreign institutional investors sold a net NT$16.40 billion worth of shares on the main board on Friday.