Taiwan Stock Market, TSMC's Dominance, and Distressed Property Deal
Table of Contents
You might want to know
- What factors influenced Taiwan's stock market to drop significantly?
- How does TSMC maintain its dominance with over 70% market share?
Main Topic
On September 1, the Taiwan Stock Exchange experienced a notable downturn, dropping 161.37 points or 0.37%, closing at 24,071.73 points, crossing below the monthly moving average. The total market turnover reached NT$5,090.76 billion, with the three major institutional investors net selling a total of NT$216.22 billion. Despite this, foreign investors heavily purchased stocks such as Taiwan Cooperative Bank, Shin Kong Financial Holding, Winbond Electronics, Foxconn, and Zhen Ding Technology Holding, each surpassing 10,000 shares.
Market sentiments were further influenced by ongoing trade tensions. The United States' announcement of reciprocal tariffs has prompted manufacturers to remain cautious, awaiting details on tariff negotiations and implementation under Section 232. This cautious sentiment was reflected in the Chung-Hua Institution for Economic Research's PMI report for Taiwan's manufacturing sector in August. The PMI recorded a continuous three-month contraction, falling by 0.1 percentage points to 47.9%, the lowest since April 2024. Additionally, the six-month outlook index declined by 0.7 percentage points to 37.6%, marking five consecutive months of contraction.
Real estate transactions also took a hit. Listed builder Kee Tai Properties announced the cancellation of a major NT$12.5 billion sale in Taipei's prime district. The buyer failed to pay the third installment of the purchase price for Kee Tai Zhongxiao Tower, leading to a forfeiture of NT$625 million in advance payments as a penalty, effectively voiding the transaction.
In semiconductor insights, TrendForce's latest research signals a positive shift in the global foundry market. By Q2 2025, due to China's consumer subsidies causing preemptive stockpiling and a rise in demand for new smartphones, laptops, PCs, and servers, overall foundry capacity utilization and shipment volumes are anticipated to strengthen. This growth is expected to push the revenue of the top ten global foundries to USD 41.7 billion, achieving a sequential increase of 14.6%. Dominating the scene is Taiwan Semiconductor Manufacturing Company (TSMC), boasting a market share exceeding 70%, asserting its leadership.
Additionally, labor and corporate measures reflected challenging times. Currently, 245 companies in Taiwan have enforced furloughs, affecting 4,863 employees. This is a stark increase compared to the 191 companies and 3,934 employees reported on August 18. Among these, 62.8% of companies cited U.S. tariffs as the reason for reducing work hours, affecting 3,055 employees.
On the corporate front, pharmaceutics company OBI Pharma held a significant press conference, announcing board approval for a capital reduction to offset losses, aimed at improving the financial structure and company net worth. This involves a NT$1.316 billion reduction, cancelling 131,579,687 shares or 50% of issued ordinary shares.
Key Insights Table
| Aspect | Description |
|---|---|
| Stock Market Drop | The Taiwan stock market fell significantly, impacted by broad net selling. |
| TSMC Dominance | TSMC continues to control over 70% of the global foundry market. |
| Failed Real Estate Deal | A major Taipei property deal was cancelled due to a payment failure. |
| Increased Furloughs | Significant rise in furloughed workers due to tariff impacts. |
Afterwards...
Looking forward, Taiwan's economic sectors, especially technology and manufacturing, face ongoing challenges from international market dynamics. Companies may need to engage in innovative strategies to navigate these turbulent times, while policymakers strive to stabilize economic conditions.
Investment in research and development within the technology sector continues to be a promising avenue for maintaining competitiveness. As global demands shift, adapting to new technologies and market needs will likely shape the future landscape of Taiwan's industries.