Friday in Taipei delivered a rebound with an asterisk. The TAIEX rose 141.39 points, or 0.30%, to close at 47,111.26, reclaiming the 47,000 mark after Thursday’s 3.41% drubbing to 46,969.87. But the bounce faded badly — the index was up more than 500 points intraday at a high of 47,520 before cautious selling capped the session — and the week still ended with a cumulative loss of 2,202.18 points, snapping a four-week winning streak. Turnover was a healthy NT$935.96 billion. The defining tension remains unchanged: domestic buyers are stepping in, and foreign money is walking out.
The flow picture: foreigners sell an eighth straight session
Friday’s institutional numbers from the exchange tell the story plainly. The three major institutional categories were combined net sellers of NT$67.81 billion on a day the index closed higher — the rebound was carried by everyone else.
| Investor group | Net trading value (Oct 16) | Context |
|---|---|---|
| Foreign investors | −NT$46.15B (net sell) | Eighth consecutive session of net selling |
| Investment trusts | +NT$11.75B (net buy) | Sixth consecutive session of net buying |
| Dealers (prop + hedge) | −NT$33.41B (net sell) | |
| Combined | −NT$67.81B |
The domestic investment trusts’ six-day buying streak is doing real cushioning work, but at roughly a quarter the size of the foreign outflow, it is a shock absorber, not a counterweight.
TSMC: a record quarter meets a cool reception
TSMC (2330) reported a record Q3 net profit of NT$763.06 billion on Thursday — up 68.7% year-over-year, with diluted EPS of NT$29.43 — on strong AI and high-performance computing demand. The stock’s reward on Friday: down NT$20, or 0.82%, to NT$2,420. The market’s reading is that the number was superb but the incremental news was not — gross-margin guidance and capital expenditure were not revised further upward, caution lingers around consumer electronics, and Thursday’s 0.88% decline in the Philadelphia Semiconductor Index gave the stock no overnight tailwind.
One footnote for cross-listed watchers: TSM ADRs closed Thursday in New York at $422.25, putting the ADR premium over Friday’s Taipei close at about 13% — below the roughly 15–25% structural band the gap has occupied in recent years. The level itself means little (the premium is structural, fungibility is limited, and the two closes are from different sessions); the compression versus the recent range is the data point worth tracking alongside the foreign outflows.
Beneath the index: AI hardware carried the day
- MediaTek (2454) rose 2.04% to NT$4,250 on optimism around AI chip and ASIC partnerships.
- Hon Hai (2317) gained 1.88% to NT$244 on steady AI server infrastructure demand; Quanta (2382) closed at NT$322.
- UMC (2303) slipped 0.37% to NT$133.
- By sector: Shipping +1.98% and Financials & Insurance +1.10% outpaced Semiconductors at +0.32% — a rebound led from outside the market’s engine room.
Positioning: shorts built into Thursday’s plunge
The latest leverage and positioning data are from Thursday’s session (Friday’s figures are not yet published), so read them as the setup into today rather than today’s action. Three separate channels, kept separate:
- Retail leveraged longs (margin purchases): the market-wide margin loan balance stood at NT$646.4 billion as of Thursday, down NT$5.14 billion — modest retail de-leveraging into the drop, not capitulation. TSMC’s margin balance actually rose 457 lots.
- Institutional shorts (SBL): securities-lending short balances rose in 509 issues versus 373 declines on Thursday. The builds were concentrated in the heavyweights — Hon Hai +9.05 million shares, Delta Electronics +3.48 million, MediaTek +1.61 million, TSMC +0.75 million. Friday’s gains in Hon Hai and MediaTek came against that freshly built short base.
- Derivatives: foreign investors’ TAIEX futures net open interest stood at −97,582 contracts as of Thursday, and the options put/call volume ratio was 74.99%. Both predate Friday’s rebound.
The currency is the tell
USD/TWD was quoted around 32.39 on Friday, with the Taiwan dollar weakening 0.61% and trading in a 32.37–32.50 range — pressure that follows a Thursday level around 32.2, set on a record US$9.115 billion in forex volume. Hotter-than-expected U.S. inflation data earlier in the week has pushed foreign money out of Asian tech broadly, and the TWD is wearing it. Overnight, U.S. markets offered mild stabilization: the S&P 500 rose 0.33% Thursday, and S&P futures sat 0.15% higher during Taipei hours.
What to watch
- TAIFEX final settlement, Wednesday Oct 21. With foreign futures net open interest at −97,582 contracts as of Thursday, how that book resolves into monthly settlement is the week’s key mechanical event.
- The foreign selling streak. Eight sessions and counting in the cash market; a ninth, against a weakening TWD near the 32.4–32.5 range, would say the post-CPI de-risking isn’t done. A break in the streak would matter more.
- Fresh shorts vs. Friday’s bounce. Friday’s gains in Hon Hai and MediaTek moved against the apparent bearish positioning built in Thursday’s SBL data — watch whether next week’s lending figures show those positions covering or pressing.
Disclaimer: This is an information and analysis publication, not investment advice. See our Methodology for data sources, standards, and our corrections policy.