No trading today: Typhoon Bavi closes the exchange
There is no Taiwan tape to report this Friday. The Taiwan Stock Exchange suspended all trading, clearing and settlement on July 10 as Typhoon Bavi approached the island, with Taipei calling off work and classes. That leaves Thursday, July 9 as the last set of prints — and they were not kind. The TAIEX closed at 45,354.61, down 379.8 points (0.83%), sealing a weekly loss of 1,426.01 points, or 3.05%. The pullback reflects profit-taking after the AI-driven record run earlier this year, compounded by renewed US–Iran tensions that lifted crude prices and revived inflation worries.
Institutional flows: foreigners sold hard into the break
Thursday’s official TWSE flow data — the last before the typhoon closure — showed foreign investors as heavy net sellers, only partially absorbed by domestic institutions.
| Investor type (July 9) | Net trading value | Direction |
|---|---|---|
| Foreign investors | NT$-47.25B | Net sell |
| Investment trusts | NT$+19.90B | Net buy |
| Dealers (prop + hedge) | NT$-7.67B | Net sell |
| Three institutions combined | NT$-35.02B | Net sell |
The pattern is familiar from risk-off weeks: foreign money lightens up on the index heavyweights while investment trusts lean the other way. On the derivatives side — and note these are also previous-session figures, not a read on typhoon-day positioning — foreign investors carried a net short of 80,730 contracts in TAIEX futures open interest as of Thursday, and the options put/call ratio stood at 118.81% on open interest (100.89% on volume). A put-heavy book into next Wednesday’s settlement is worth keeping in mind, but it describes where positioning stood at Thursday’s close, nothing more.
Semiconductors: heavyweights fell, but the sector didn’t
The index-level damage Thursday came from the very top of the market. TSMC dropped 2.03% to NT$2,415.00, MediaTek fell 1.75% to NT$3,925.00, and UMC slid 4.29% to NT$156.00. Hon Hai was the rare flat spot at NT$237.50. Yet the TWSE semiconductor sector index actually rose 1.11% on the day — breadth beneath the megacaps was firm, with ASE Technology surging 8.32% and GlobalWafers hitting its daily limit up. Financials and insurance added 1.26% and shipping gained 0.45%, so Thursday’s decline was a heavyweight story, not a broad one.
That divergence matters for the reopen, because the overnight backdrop turned sharply friendlier after Taipei went dark. The Philadelphia Semiconductor Index jumped 3.06% to 12,960.00 and the S&P 500 rose 0.81% to 7,543.64 at Thursday’s US close, though S&P futures gave back 0.20% in Friday’s overnight session. Taiwan’s chip complex will have two US sessions to digest by the time trading resumes.
On the ADR side, TSM closed at $436.96 in New York on Thursday, about 16.1% above the Taipei close on an adjusted basis. As regular readers know, that premium is structural — it has run roughly 15–25% in recent years given limited fungibility — and the two closes come from different sessions. The level tells you nothing; what is worth watching is that at 16.1% the gap sits toward the low end of its recent range, and whether it widens on Monday’s catch-up trade.
Leverage and shorts: three channels, three different stories
- Retail leveraged longs (margin purchases): the market-wide margin loan balance rose NT$5.83B on Thursday to NT$619.6B — retail kept adding leverage into a down tape, which is exactly the behavior the central bank flagged recently when it warned about record brokerage borrowing. UMC stood out: margin balance up 3,244 lots on a day the stock fell 4.29%, classic dip-buying, and at 39.2x earnings and 4.83x book, not a cheap dip.
- Institutional shorts (SBL): securities-lending short balances rose in 513 issues and fell in 386 on Thursday — a mild bearish tilt in breadth. Hon Hai saw the notable single-name build, up 597,000 shares, while Delta Electronics (-503,440 shares) and UMC (-468,686) saw covering. TSMC’s SBL balance was essentially unchanged (+11,000 shares against a balance of 11.36M).
- Retail shorts (margin shorts): quiet by comparison — small builds in UMC (+294 lots) and Hon Hai (+69), trims in TSMC and MediaTek.
Put together, the setup into the closure was a moderately stretched one — foreign cash selling, a foreign futures net short, an elevated put/call ratio, and rising retail leverage — but all of it is Thursday’s snapshot, now aging over a long weekend with a constructive US tape layered on top.
What to watch
- Monday’s reopen: the TAIEX has a 3.06% SOX rally and a 0.81% S&P gain to price in, tempered by softer overnight futures (-0.20%). Watch whether foreign selling resumes or the US chip bid pulls flows back.
- Wednesday, July 15 — TAIFEX final settlement: foreigners went into the closure net short 80,730 TX contracts with a compressed number of sessions left before expiry.
- Thursday, July 16 — TSMC Q2 earnings (14:00 Taipei): the week’s main event. Also note the monthly revenue filing deadline fell on today’s typhoon closure — watch for the timing of June sales reports when operations resume.
Disclaimer: This is an information and analysis publication, not investment advice. See our Methodology for data sources, standards, and our corrections policy.