Taiwan shares dive in early morning session

Taipei, Taiwan shares plunged by more than 270 points to below the 9,500-point mark in early morning trading on Thursday, following a dive on Wall Street overnight.

The Taiwan Stock Exchange's main index (TWSE) or the Taiex opened down 136.45 points at 9,622.95 following a tumble on Wall Street where the Dow Jones Industrial Average closed down 2.41 percent at 24,583.42, the S&P 500 index ended down 3.09 percent at 2,656.10, and the tech-savvy Nasdaq index fell 4.43 percent at 7,108.40.

The Taiex dropped over 270 points within one minute of the opening, hitting a low of 9,475.61, the lowest in 20 months, with large-cap companies in Apple's supply chain in focus. Shares in smartphone camera lens supplier Largan Precision Co. and chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC) both dropped over 4 percent at one point.

Following a 6.61 percent drop in the PHLX Semiconductor Sector Index, United Microelectronics Corp., a smaller rival of TSMC, shed 6.32 percent at one point.

However, Largan quickly recouped some of its early losses, helping push the broader market back over 9,500 points.

Analysts at Fubon Investment Services said the factors affecting Taiwan's stock market remain unchanged, including trade friction between the United States and China, growing tensions across the Taiwan Strait and a volatile U.S. stock market, pushing investors to the sidelines.

Meanwhile, Finance Minister Su Jain-rong (???) said Thursday that the state-run National Stabilization Fund Committee would meet to decide whether the fund should enter the local equity market to prop up share prices if there is proof the market is irrational.

Su was responding to a reporter's question as to whether the government will authorize the fund to intervene in the local stock market as the Taiex hit a 20-month low.

For the time being, the weakness in the local equity market is being caused by uncertainty over the international political and economic situation, Su said, adding that the fluctuations are short-term and the committee will keep a close watch on the market.

Source: Focus Taiwan News Channel