TAIPEI (Taiwan News) — Taiwan’s stock market closed slightly higher on Wednesday following a volatile session, with late-session buying helping the index rebound from earlier losses despite thin trading activity.
The Taiwan Stock Exchange Capitalization Weighted Stock Index, or TAIEX, rose 23.9 points to close at 20,546.49. Turnover totaled NT$270 billion (US$8.9 billion), the lowest in five trading days, indicating cautious investor sentiment, according to CNA and CTEE.
TSMC saw a late rally with nearly 7,000 shares traded in the final minutes, closing up 0.87% at NT$928 (US$30). Foxconn slipped 0.68% to NT$145, and MediaTek dropped 0.39% to NT$1,275.
Companies posting strong first-quarter results outperformed the broader market. Event organizer Kuang Hong Arts Management hit the daily 10% trading limit after announcing record-high earnings per share for a single month, and Uni-President Enterprises Corp. also rose to the daily limit after reporting a threefold increase in quarterly profit.
Meanwhile, the Taiwan dollar showed signs of weakening after a brief rebound. The currency’s recent strength has benefited the tourism and airline sectors, as the ongoing boom in outbound travel is expected to continue.
Airline stocks retreated across the board. Tigerair Taiwan dropped 7.15%, while Eva Air, China Airlines, and Starlux Airlines fell by over 1%.
Construction stocks, previously seen as safe havens during periods of currency appreciation, also faced pressure. Jsl Construction & Development hit the daily limit down after reports of a private placement scandal.
Other developers, including DaCin Construction, Fuyu Property, YeaShin International Development, and Full Wang International Development, dropped between 5% and 9%.
As Taiwan approaches May 20, historically a time for a short-term boost in market sentiment known as the “520 rally,” defense-related stocks gained traction. Air Asia, Papro, and Aewin all closed in positive territory.
The 520 rally refers to a pattern seen around May 20, the day of Taiwan's presidential inauguration. In the past, this rally has been driven by efforts from the incoming administration to energize the stock market, often through administrative or fiscal measures, creating a festive atmosphere that encourages investor optimism.
The annual trend has historically led to short-term gains as investors seize the opportunity for potential profits, according to the National Policy Foundation.
In the photonics sector, Foci Fiber Optic Communications saw a daily limit rise after reporting an 80.56% year-over-year increase in April revenue, its best performance in 44 months. The positive momentum extended to peers like Ligitek Electronics, Apac Opto Electronics, and Visual Photonics Epitaxy.
Investor interest also increased in China-focused leveraged ETFs after the People’s Bank of China announced cuts to both reserve requirement ratios and interest rates. Popular ETFs included the Yuanta Daily CSI 300 Bull 2X ETF, CTBC MSCI China Free 50 ex A and B Daily Leveraged 2X ETF, and the Fubon Hang Seng China Enterprises Leveraged Index ETF.
Cathay Securities Investment analyst Tsai Ming-han (蔡明翰) said markets are cautious ahead of the US announcement on semiconductor tariffs. A higher-than-expected tariff rate could lead to significant short-term volatility.
Adding to the uncertainty, the US Federal Reserve is scheduled to release its latest interest rate decision this week, prompting investors to remain vigilant for any further policy changes.
This information is not intended as personalized financial advice. Investors are encouraged to conduct their own research and analysis before making investment decisions.
