The TAIEX surged 939.35 points, or 2.04%, to close at 47,035.58 on Wednesday, October 28 — reclaiming both the 47,000 threshold and its quarterly moving average after touching an intraday high of 47,060.46. Turnover was a heavy NT$722.135 billion. The move tracked a strong overnight US tech session: the Philadelphia Semiconductor Index jumped 3.60% to 11,482.50 on Tuesday for a third straight gain, with the S&P 500 up 0.60%, as Anthropic’s advancing IPO filing and expanded compute purchases eased recent anxiety over the AI capex cycle. Easing oil prices helped the mood.
Semiconductors did the heavy lifting
The TWSE semiconductor sub-index rose 2.29% on Wednesday, comfortably ahead of financials and insurance (+0.56%) and shipping (+0.22%). The standout was MediaTek (2454), up NT$275 (+6.94%) to NT$4,235 on pre-earnings positioning ahead of Friday’s investor conference. UMC (2303) gained 4.49% to NT$128.00. TSMC (2330) added a more modest NT$25 (+1.04%) to NT$2,425 after its ADRs rose 2.95% overnight. Hon Hai (2317) climbed 1.62% to NT$251.50, with fellow AI-server assembler Quanta (2382) up 0.76%.
Second-tier themes ran hotter. Nanya Technology (2408) rallied over 8% to NT$477 on AI memory and 4F2 momentum; AUO (2409) gained over 5% on market-leading volume above 190,000 lots ahead of its October 29 investor conference, and Innolux (3481) rose 4.76% to NT$48.45, both lifted by glass-substrate (TGV) and panel-level packaging (FOPLP) stories.
One caveat worth keeping in view after a move like MediaTek’s: at Tuesday’s close the stock already traded at 65.4x trailing earnings and 14.9x book, against TSMC at 27.8x and UMC at 18.4x. Friday’s guidance will need to carry that multiple.
Institutional flows: all three columns green
The three major institutional categories combined for NT$29.89 billion of net buying on Wednesday — a plain, one-directional day:
| Investor group | Net trading value (Oct 28) | Note |
|---|---|---|
| Foreign investors | NT$+15.92B (net buy) | Ends a two-session selling streak |
| Investment trusts | NT$+11.81B (net buy) | 12th consecutive session of buying |
| Dealers | NT$+2.17B (net buy) | NT$2.448B proprietary buying, NT$283M hedging net sales |
The foreign return to the cash market is the headline flow. The investment-trust streak — now twelve sessions — remains the steadiest bid under this market.
Positioning: futures shorts still heavy, retail leverage still shrinking
A note on timing: TAIFEX positioning data lags by a session, so the figures below describe Tuesday’s setup, not Wednesday’s action. As of Tuesday, October 27, foreign investors held a net short of 86,043 TAIEX futures contracts — still a substantial hedge book — though the day’s net volume of +1,221 contracts pointed to trimming at the margin, and press reports indicate foreigners continued reducing net futures shorts alongside Wednesday’s spot buying. Tuesday’s volume-based put/call ratio stood at 89.89%, hardly a fearful reading.
On the leverage side, keep Taiwan’s three channels separate. Retail leveraged longs (margin purchases) fell: the market-wide margin loan balance dropped NT$10.49 billion to NT$623.4 billion as of Tuesday — a rally arriving while retail gearing declines, not builds. In the institutional short channel (SBL), balances rose in 626 shortable issues and fell in 278 on Tuesday, so short books broadened even as index-level bearishness looked stale. At the single-stock level the picture was mixed: Hon Hai saw a sizable 4.95 million shares of SBL covering and MediaTek 888,000 shares, while TSMC (+515,000 shares) and Delta Electronics (+634,000) saw modest SBL additions.
Currency and the ADR gap
The Taiwan dollar firmed, with USD/TWD quoted around 32.40 on Wednesday, strengthening about 0.4% — consistent with foreign money re-entering the cash market. The session’s FX subplot came from the Legislative Yuan, where Central Bank Governor Yang Chin-long testified that the bank net sold US$10.74 billion in the first half of the year to curb excessive TWD depreciation amid foreign outflows. Wednesday’s inflow-and-stronger-TWD combination is exactly the configuration that eases that pressure.
TSMC’s ADR closed at $436.87 in Tuesday’s US session, roughly 16.8% above Wednesday’s Taipei close on a share-adjusted basis. As regular readers know, this premium is structural — it has run roughly 15–25% in recent years given limited fungibility — and the two closes come from different sessions. At 16.8% the gap sits toward the lower end of its recent range; the day-to-day drift of that gap, not its level, is what carries information, and it is no arbitrage.
What to watch
- MediaTek’s Friday investor conference. A 6.94% pre-earnings run-up at 65x trailing earnings sets a high bar; guidance will determine whether Wednesday’s buyers get paid.
- Wednesday’s TAIFEX positioning data, published Thursday. Confirmation (or not) that foreign investors kept trimming the 86,043-contract net futures short while buying spot would mark a genuine stance shift rather than a one-day bounce.
- AUO’s October 29 investor conference. After a 5%+ move on outsized volume, the TGV/FOPLP narrative gets its first management reality check.
Disclaimer: This is an information and analysis publication, not investment advice. See our Methodology for data sources, standards, and our corrections policy.