Foreign Investors End 10-Day Selling Streak as Taiwan Stocks Rebound

Preface

Taiwan’s stock market rebounded sharply on the 21st, supported by gains in electronics shares. A surge in trading during the final session helped lift the benchmark, while foreign investors reversed course and became net buyers after selling for 10 consecutive trading days. Their purchases included more than 20,000 lots each of AUO, Hon Hai, and Nanya Technology. The session also saw varied activity among institutional investors and in the futures market, alongside an appreciation of the New Taiwan dollar against the U.S. dollar. This article reviews the day’s market performance, currency movement, institutional flows, and the stocks that attracted the most buying and selling. It also outlines a senior analyst’s view that the successful move above the 5-day moving average was encouraging, while emphasizing that sector rotation remains an important factor to monitor.

Lazy bag

Taiwan’s benchmark index closed at 46887.77, up 594.84 points, after a late-session surge. Foreign investors ended 10 consecutive sessions of selling, recording net purchases of 9.6億元 in the cash market. They bought more than 20,000 lots each of AUO, Hon Hai, and Nanya Technology. Trust funds purchased 129.19億元, while dealers sold 133.11億元, leaving the three major institutional investor groups with combined net buying of 5.68億元. The New Taiwan dollar strengthened to 32.488 per U.S. dollar. A market analyst described the outlook as tilted toward the bulls following the close above the 5-day line, while cautioning that rotation among sectors warrants close attention.

Main Body

Taiwan’s stock market staged a strong rebound on the 21st, with electronics shares providing the main support. A large burst of trading in the final session added momentum to the advance: the index rose 160.56 points during that closing phase and finished at 46887.77, up 594.84 points for the day. The market closed above its 5-day moving average. Total trading value reached 8331.91億元, reflecting an active session and heightened investor participation.

The late buying also coincided with a notable change in foreign-investor activity. Foreign investors had been net sellers in the centralized market for 10 consecutive trading days, with cumulative selling of 8380.64億元 over that period. On the 21st, they shifted to net buying of 9.6億元 in the cash market, ending the extended selling streak. Among the shares they bought most heavily were AUO (友達, 2409-TW), Hon Hai (鴻海, 2317-TW), and Nanya Technology (南亞, 1303-TW), each with purchases exceeding 20,000 lots.

Foreign investors’ other prominent net purchases included Wistron, Compal, Innolux, CTBC Financial, Formosa Petrochemical, Winbond Electronics, and Ruentex Industries. Their most heavily sold shares included Compeq Manufacturing, Ho Yi, Taini (泰金寶-DR), United Microelectronics, WNC, Taiwan Semiconductor Manufacturing Company, United Renewable Energy, Chung Hwa Chemical, Ho Tung Chemical, and Cheng Mei Materials. These lists show that foreign flows were selective: substantial purchases in several electronics and financial names occurred alongside selling in other technology and industrial stocks.

Institutional activity was mixed across investor categories. In the cash market, investment trusts recorded net purchases of 129.19億元, while dealers posted net selling of 133.11億元. Combined with foreign investors’ net purchases of 9.6億元, the three major institutional investor groups recorded total net buying of 5.68億元. The contrasting figures indicate that the overall institutional balance reflected differing strategies among foreign investors, investment trusts, and dealers rather than a uniform move by all groups.

Investment trusts’ leading purchases included KGI Financial, AUO, China Steel, Wistron, Synnex, Taiwan Cement, MiTAC, Taiwan Semiconductor Manufacturing Company, KYEC, and Quanta Computer. Their most heavily sold stocks included United Microelectronics, EVA Air, China Airlines, Winbond Electronics, Uni-President Enterprises, Mega Financial, Taishin Shin Kong Financial, Yuanta Financial, Acer, and Inventec. The presence of both technology companies and financial, transport, and industrial names in these rankings suggests that trust-fund positioning was not concentrated in a single sector.

Dealers’ most notable net purchases included AUO, Innolux, Wistron, Nanya Technology, KYEC, Hua Nan Financial, Winbond Electronics, E.Sun Financial, CTBC Financial, and Mega Financial. Their leading sales included Hon Hai, Taiwan Glass, China Steel, United Microelectronics, Taiwan Mobile, Shinkong Synthetic Fibers, Taiwan Semiconductor Manufacturing Company, and Macronix. The difference between dealer flows and those of foreign investors is particularly visible in Hon Hai: it was among the foreign investors’ largest purchases but among dealers’ most heavily sold shares.

In the futures market, foreign investors’ net trading position was a long position of 1062 contracts. Their net open interest, however, remained a short position of 86072 contracts. The distinction between daily trading and outstanding positions is important: the day’s net long trading activity did not eliminate the substantial short open interest reported at the close. These figures provide additional context for assessing institutional positioning alongside cash-market flows.

The currency market also moved in a supportive direction for the New Taiwan dollar. The currency closed at 32.488 per U.S. dollar, appreciating by 1.29角. Trading value in the Taipei foreign exchange market was 20.6億 U.S. dollars. The New Taiwan dollar opened at 32.630, reached an intraday high of 32.429, and touched a low of 32.704. The reported intraday range and closing level accompanied the day’s broader shift in market sentiment.

Senior securities analyst Jian Boyi (簡伯儀) said the Taiwan market successfully challenged and moved above its 5-day moving average. In his assessment, positive corporate earnings reports contributed to a market structure leaning toward the bullish side. He also cautioned that investors should pay particular attention to sector rotation. A rising benchmark does not mean every industry or stock is advancing equally, and leadership can shift as capital moves among sectors. The day’s mixed institutional buying and selling lists illustrate why tracking those changes may matter even during a broad market rebound.

Overall, the session combined a sizable index advance, a high level of trading activity, and a reversal in foreign-investor flows after 10 consecutive selling sessions. The close above the 5-day line and favorable earnings news supported a more positive near-term tone, while futures positioning and divergent institutional trades offered a more complex picture. The analyst’s emphasis on sector rotation provides a measured conclusion: the market’s direction was constructive, but investors still needed to distinguish between the strength of the overall index and the performance of individual sectors.

Key Insights Table