Taiwan Stocks Plunge Nearly 1200 Points; Firms Predict 42500-45000 Range This Week

Taiwan's stock market experienced a sharp decline last week, with the main index falling by nearly 1200 points. The market closed at 43,654.84 points, a gain of 2.30% for the week, having briefly reclaimed the quarterly moving average. Despite this recovery, investment firms are advising caution.

Looking ahead, investment consultancies predict the market will trade within a range of 42500 to 45000 points this week. While the medium-term bullish trend remains intact, the short-term outlook suggests a period of volatile consolidation. Analysts point to a significant deviation of over 50% from the annual moving average, historically a large gap. Although AI-related positive news has seen some diffusion, its impact on the broader market is diminishing. Furthermore, margin financing balances remain high, exceeding 580 billion yuan, indicating a potentially unstable market structure.

Experts warn that any market noise could trigger further selling pressure, leading to increased short-term volatility. They suggest that individual stocks might outperform the broader market, and investors should focus on new themes and rotating sectors. The Financial Supervisory Commission (FSC) stated it is closely monitoring market fluctuations in response to international conditions.