Institutional Investors See Black Monday: Taiwan Stocks Outperform Japan and South Korea

(Central News Agency reporter Tseng Jen-Kai, Taipei 8th) Following a sharp drop in U.S. stocks last Friday, Taiwan stock futures fell over 3,000 points in after-hours trading. Taiwan's stock market faced the 'Black Monday' test today, plunging up to 2,694 points in early trading, the largest intraday drop in history. The decline later narrowed, with the TAIEX closing down 1,568.16 points, or 3.48%, at 43,502.78 points. The monthly line at 43,116 points was briefly breached but recovered.

According to institutional observations, compared to South Korea's KOSPI index, which plunged 8% at the open and triggered a circuit breaker, and Japan's Nikkei index, which fell over 4%, Taiwan's stock market performance today was relatively resilient.

Stocks that bucked the downtrend today included server rail giant King Slide, memory maker Innodisk, stock king ASPEED Technology, thermal module makers Jentech and Kaori, semiconductor test interface firm Chunghwa Precision Test Tech, PCB-related companies Gold Circuit Electronics and Topoint Technology, and World Cup concept shoemaker Lai Yih Footwear. These attracted buying interest, closing higher against the trend, showing that stocks with solid earnings support still have resilience during a market correction.

Chen Chao-cheng, a fund manager at Capital Investment Trust, analyzed that the short-term U.S. stock pullback is fueling market concerns and inevitable selling pressure from leveraged funds. Long-term capital may need to wait for the panic to subside before long-term buying opportunities emerge. If the spot market sees heavy selling volume accompanied by a significant drop in margin debt, it could actually help sustain the bull market and bring trading back to rationality.

Chen advised investors to focus on groups with core competitive advantages, avoid small and mid-cap companies with themes but unverified fundamentals, and companies sensitive to interest rate changes due to rate hike expectations. He recommended preserving capital and focusing on AI bellwether stocks with solid fundamentals.

KGI Securities Investment Trust pointed out that while U.S. stocks saw a sharp correction last Friday and Taiwan stocks adjusted this morning, the long-term AI bull market is not over. This stock market correction is more like a healthy correction triggered by short-term market overheating.

KGI believes the AI investment cycle has moved from the initial theme-driven phase to a development stage where revenue and profits are materializing. The structural opportunities for Taiwan's supply chain, which holds a technological leadership position, still offer profit growth momentum worth anticipating. Amid chaotic positioning and volatile market conditions, this actually presents relatively suitable entry opportunities. (Editor: Chang Liang-chih) 1150608