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🇹🇼 Taiwan /Economy & Trade

Taiwan Stocks Set to Plummet Monday? Commentator Ruan Mu-hua Points to Potential 'Graduation' for Investors

From Liberty Times · () Chinese

Translated from Chinese, summarized and contextualized by DistantNews.

At a glance

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  • Taiwan's stock market faces potential sharp declines on Monday following a significant drop in US stocks, with experts warning of "graduation" for many investors.
  • The Philadelphia Semiconductor Index experienced its largest single-day drop in six years, losing 10.26% and wiping out $1 trillion in market value, with Nvidia contributing $300 billion to the loss.
  • Investors are advised to manage leverage, prepare contingency funds, and avoid excessive anxiety, as the long-term bullish structure remains intact despite the short-term market correction.

Taiwan's stock market is bracing for a potentially turbulent Monday, with financial experts warning of significant losses for investors. The market's outlook is grim following a sharp downturn in US stocks on Friday, which sent Taiwan's stock futures plummeting.

Perhaps many people will graduate on Monday, and the Taiwan stock market may be 'waiting in fear'.

— Ruan Mu-huaFinancial commentator Ruan Mu-hua's warning about the potential market downturn on Monday.

Financial commentator Ruan Mu-hua highlighted the severity of the situation, noting that the Philadelphia Semiconductor Index saw its largest single-day decline in six years on June 5, shedding 10.26% and erasing $1 trillion in market value. Nvidia alone accounted for $300 billion of this loss.

Ruan cautioned that many investors, particularly those who have increased their leverage, could face substantial losses, a phenomenon he refers to as "graduation." He noted that margin financing in Taiwan's stock market has increased significantly this year, with over NT$550 billion added across the main and over-the-counter markets. Additionally, non-purpose loans exceeding NT$600 billion have been taken out.

Whether speculating or investing in stocks, as long as you can stay in the market, there will always be opportunities, but if you are forced to graduate, you may never come back.

— Ruan Mu-huaRuan Mu-hua's advice to investors about the importance of staying in the market.

Despite the immediate volatility, Ruan advised investors to remain calm, especially those holding quality stocks, ETFs, and funds, and to manage their leverage. He believes the long-term bullish trend remains sound, and the current market correction is a necessary, albeit potentially early, process of "bubble squeezing."

Over 1 trillion 'YOLO' leverage, next week 'waiting in fear'.

— Ruan Mu-huaRuan Mu-hua's description of the high leverage in the market and the potential for a downturn.
DistantNews Editorial

Originally published by Liberty Times in Chinese. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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