FX.co ★ Big Rebound Anticipated For Taiwan Stock Market

The Taiwan stock market experienced a sharp decline on Friday after an unexpected two-day hiatus due to Typhoon Gaemi. This downturn followed a brief break in a four-day losing streak during which the market had dropped over 1,700 points or 7.6 percent. The Taiwan Stock Exchange (TSE) closed just below the 22,120-point mark, with expectations of support in the upcoming sessions.

The broader outlook for Asian markets is positive, spurred by an improved perspective on interest rates. European and U.S. markets finished solidly higher, setting a hopeful trend for Asian markets to follow.

On Friday, the TSE saw significant losses across various sectors, particularly within technology. The index plunged 752.59 points or 3.29 percent, closing at 22,119.21, after trading between 21,889.61 and 22,206.93 throughout the day.

Notable movements included Mega Financial dropping by 0.12 percent, CTBC Financial and Fubon Financial both down by 0.70 percent, E Sun Financial diving 5.59 percent, and Taiwan Semiconductor Manufacturing Company falling 5.62 percent. Additionally, United Microelectronics Corporation decreased by 1.17 percent, Hon Hai Precision lost 4.71 percent, Largan Precision declined by 2.64 percent, and Catcher Technology dipped slightly by 0.24 percent. MediaTek saw a 2.35 percent drop, Delta Electronics fell by 0.39 percent, while Novatek Microelectronics edged up by 0.55 percent. Nan Ya Plastics also dropped by 1.19 percent, Asia Cement by 0.36 percent, and Cathay Financial, First Financial, and Formosa Plastics ended the day unchanged.

Positive signals came from Wall Street where major indexes opened higher on Friday and maintained their gains throughout the day. The Dow Jones Industrial Average soared 654.27 points or 1.64 percent to close at 40,589.34, with the NASDAQ rising 176.16 points or 1.03 percent, and the S&P 500 increasing by 59.88 points or 1.11 percent.

For the week, the Dow gained 0.8 percent, the NASDAQ fell by 2.1 percent, and the S&P 500 dropped by 0.8 percent. The market's strength was buoyed by promising inflation data released by the Commerce Department, hinting at a potential interest rate cut by the Federal Reserve in September. Additionally, revised data from the University of Michigan showed that U.S. consumer sentiment deteriorated less than previously estimated in July.

Oil prices fell on Friday due to ongoing concerns about demand amid China's economic slowdown and optimism for a ceasefire in Gaza, which also exerted downward pressure. West Texas Intermediate (WTI) crude oil futures for September closed down by $1.12 or 1.4 percent at $77.16 a barrel, marking a 1.9 percent decline for the week.