Taiwan Stock Market: When Will the Downturn End? Experts Eye Q3 for Bottoming Out

Financial analysts outline key signals to watch for a potential recovery in the Taiwan Stock Exchange, amid market volatility and global economic concerns.

The Taiwan Stock Exchange (TWSE) experienced a significant downturn on a recent trading day, plummeting over 2,000 points shortly after the opening bell and breaching the 20,000-point mark. This sharp decline resulted in substantial asset devaluation for investors.

Concerning the timing of a potential market recovery, Taishin Securities Investment Trust Co. forecasts a possible bottoming-out phase in the third quarter, particularly if the market faces a significant correction or falls below the 20,000-point threshold. The firm identifies three crucial signals to monitor for signs of stabilization:

• Short-term focus: The impact of potential semiconductor taxation policies.
• Short-term focus: The outcome of the legal cases involving TSMC (2330) and Intel.
• Medium to Long-term focus: Monitoring for any signs of an economic recession.

Taishin Securities Investment Trust Co. analysts also note that the current global economic environment poses potential risks. They highlight that the implementation of tariff policies could impact Taiwan's economic outlook. Specifically, they identify that exports to the U.S., representing 23% of total exports (and 14% of GDP), pose a significant vulnerability. Furthermore, Taiwan's high export reliance (63% of GDP) increases its susceptibility to global economic downturns.