Anticipated Sell-Off of Taiwanese Shares on Thursday Due to Profit Taking
The Taiwanese stock market has witnessed a two-day upsurge, soaring more than 300 points or 1.3%, landing just above the 22,350-point mark. Today, however, the market might stall, according to predictions.
The cloudy forecast for Asian markets can be attributed to investors' wait-and-see approach regarding the ongoing Iran/Israel conflict. Yesterday, the European and American markets exhibited mixed results with minimal change, and the Asian markets are expected to mirror this trend.
On Wednesday, the Taiwan Stock Exchange saw a modest increase, with the gains from the financial and technology sectors being contained by weakness from the plastics companies. The index concluded the day at 22,356.73, having gained 145.14 points or 0.65%.
Key players like Cathay Financial (up 0.33%), Mega Financial (up 0.37%), First Financial (up 0.71%), Fubon Financial (up 1.86%), E Sun Financial (up 0.63%), and Taiwan Semiconductor Manufacturing Company (up 0.96%) all showed improvement. However, sectors like plastics companies experienced setbacks, with Formosa Plastics slumping 1.25% and Nan Ya Plastics sinking 0.87%.
Wall Street's lead offers little clarity, as the major averages fluctuated throughout Wednesday's trade, eventually ending mixed and unchanged. The Dow fell by 0.10%, the NASDAQ rose by 0.13%, and the S&P 500 remained virtually the same.
This lackluster performance followed the Federal Reserve's decision to maintain interest rates at their current level. The Fed still anticipates two interest rate cuts this year, which would lower the rate to a range of 4.0% to 3.75% by the end of 2025.
US employment figures showed a slight decrease in first-time jobless claims last week, and new residential construction in the US saw a significant drop in May. Meanwhile, the crude oil price increased due to the sixth consecutive day of the Israel-Iran conflict, which has led to a rise in casualties on both sides[1].
In Taiwan, the central bank, also known as the de facto central bank, is anticipated to announce its monetary policy decision later today. Given the ongoing global trade tensions and market uncertainty, the bank is expected to maintain a careful balance between inflation control and economic growth[4].
Investors should keep an eye on trade policies and central bank actions to better understand the Taiwanese stock market's trajectory in the short term[2][3][5].
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(Enrichment Insights: As of mid-June 2025, the Taiwan stock market has recently decreased modestly but is expected to find some technical support near current levels. Market sentiment is influenced by external trade policies, global economic outlook, and easing tensions in some trade disputes (e.g., US-China tariff reductions). Asia’s macroeconomic environment remains mixed, with stable inflation and liquidity conditions cushioning downside risks. No specific recent or expected interest rate decisions by Taiwan’s central bank were mentioned in the available data, but ongoing macro factors suggest a cautious stance likely prevails. This outlook indicates a market environment characterized by cautious optimism, where investors should watch for developments in trade policies and central bank actions that could influence Taiwan’s stock market trajectory in the near term.)
The upcoming decision from the Taiwanese central bank's monetary policy could impact the business and finance sectors of the Taiwanese stock market, given the global trade tensions and market uncertainty. Key players in the finance industry, such as Cathay Financial and Fubon Financial, have shown improvement, but sectors like plastics companies could experience setbacks.
