Taiwan shares tumble Tuesday morning on falls in South Korea, Japan

Taipei, July 28 (CNA) Shares in Taiwan took a beating Tuesday morning, plunging more than 1,900 points as selling was sparked by heavy losses in South Korea and Japan amid concerns over massive spending in AI development, dealers said.

As of 10:48 a.m., the Taiex, the Taiwan Stock Exchange's benchmark index, had shed 1,905.28 points, or 4.37 percent, and was at 41,728.91.

Dealers said the bellwether electronics sector led the downturn as contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC), which accounts for over 40 percent of total market, had fallen 2.77 percent to NT$2,285.00.

Dealers said worries that the major cloud service providers will not generate adequate sales from their large investments in AI infrastructure have deepened after Alphabet (Google's parent company) reported last week that its free cash flow had turned negative.

Led by heavy losses suffered by memory chip suppliers Samsung Electronics Co. and SK Hynix Inc, Taiwanese counterparts Nanya Technology Corp. and Winbond Electronics Corp. slid 10 percent, the maximum daily decline, to NT$392.00 and NT$144.00, respectively as of 10:21 a.m.

Dealers said that if the Taiex fails to return to the 42,000-point level by the end of Tuesday's session, the local market will have become more technically fragile.