Taiwan shares plunge 1,478 points as tech selloff erases prior gains

Taipei, June 10 (CNA) Taiwan's stock market tumbled sharply Wednesday as heavy selling in major technology stocks triggered a broad-based decline, sending the benchmark index below its monthly moving average and erasing all of the previous session's gains.

The Taiex, the Taiwan Stock Exchange's benchmark index, closed at the day's low of 43,225.54, down 1,478.90 points, or 3.31 percent, marking the sixth-largest single-day closing-point decline in the market's history. Turnover totaled NT$1.32 trillion (US$41.46 billion).

The benchmark finished at its intraday low, breaking below the 30-day moving average of approximately 43,349 points.

The losses fully wiped out Tuesday's 1,201-point rebound.

Among heavyweight stocks, contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC), which accounts for over 40 percent of total market value, fell 2.17 percent to close at NT$2,255.00.

Smartphone IC designer MediaTek Inc. dropped 7.15 percent to end at NT$4,155.00, while power management solution supplier Delta Electronics Inc. plunged 8.90 percent to close at NT$2,200.00.

AI server maker Hon Hai Precision Industry Co., known globally as Foxconn, lost 5.23 percent to close at NT$263.00.

Largan Precision Industry Co., a smartphone lens supplier to Apple Inc., bucked the broader market trend, hitting the daily limit-up for a second consecutive session and closing up 6.31 percent to end at NT$4,130.00.

On Tuesday, Largan Chairman Lin En-ping (林恩平) disclosed at the company's annual shareholder meeting that it expects to complete construction of its first automated trial production line for co-packaged optics (CPO) by September.

The passive components sector experienced volatile trading. Sector leader Yageo Corp. initially surged to the daily limit-up, pulling more than 10 peer stocks to limit-up gains. However, the stock reversed course sharply after midday, ending down 0.85 percent at NT$819.00, with an intraday swing of more than NT$100.

Construction and building materials stocks emerged as the session's standout sector after Central Bank Governor Yang Chin-long (楊金龍) said earlier Wednesday that the current round of selective credit controls had reached its endpoint, prompting market speculation that authorities are unlikely to introduce an eighth round of property-cooling measures in the near term.

Several construction and building-material stocks hit their daily limit-up, including Chainqui Construction Development Co., Hsin Ba Ba Corp., and Kindom Development Co.

Chen Po-chou (陳柏州), president of CTBC Securities Investment Service Co., said the latest market pullback was primarily driven by technical and liquidity factors rather than fundamentals.

He noted that the recently concluded Computex technology exhibition showed that demand linked to artificial intelligence remained robust.

Chen flagged three indicators to watch: margin financing balances, currently at NT$563.8 billion and ideally needing to fall below NT$500 billion; foreign investors' net short futures positions, which eased from a record 69,000 contracts last Friday to around 61,800 on Tuesday and should ideally drop below 60,000; and U.S. Treasury yields, which remain elevated in the 4-5 percent range and could continue to weigh on equities.

According to the TWSE, foreign institutional investors sold a net NT$93.57 billion of shares on the main board Wednesday, the eighth-largest single-day net outflow on record, extending their selling streak to five straight sessions with cumulative net sales of NT$437.4 billion.