Foreign investors unloaded NT$1.65 trillion of Taiwan shares on Tuesday, the third-largest single-day sell on record, as the TAIEX plunged 960.65 points to close at 48,341.31 on turnover of NT$1.13 trillion.
The Taiwan Stock Exchange said combined foreign, proprietary, and trust-fund selling reached NT$1.98 trillion, while domestic investment trusts bought NT$238.7 billion—classic dip-buying that could not offset overseas liquidation. The session extended a five-trading-day foreign selling streak that has removed roughly NT$4 trillion of offshore exposure from the market.
What triggered the move
Traders cited overnight weakness in U.S. technology shares and fresh warnings from Broadcom CEO Hock Tan and Intel CEO Lip-Bu Tan that AI infrastructure spending may outrun available capital. In Taipei, that narrative hit names already priced for perfection: Taiwan Semiconductor Manufacturing Co. fell NT$50 to NT$2,490, while AI server supply-chain stocks such as Wistron and Quanta dropped more than 6 percent.
Market veterans noted the index briefly fell more than 1,200 points intraday before buyers stepped in near the 48,000 psychological level. Proprietary desks at local brokers were among the heaviest sellers, cutting NT$569.8 billion of positions in what some desks described as risk reduction ahead of Wednesday’s TSMC results.
Chip supply chain in the crosshairs
Memory and substrate names took the brunt. Taiwan Optical Platform slid 9.84 percent, and several smaller AI PCB makers touched daily limit-down bands. The sell-off was broad enough that the GreTai Securities Market, which tracks mid caps, fell 3.18 percent, signaling that margin-heavy traders were not confined to the megacap tier.
Despite the carnage, some analysts argued fundamentals have not changed overnight. September revenue reports from many electronics firms still showed year-on-year growth, and the Taiwan dollar did not spike, suggesting the move was positioning rather than a currency shock.
What happens before the open Wednesday
All eyes now turn to TSMC’s earnings call scheduled for 2:00 p.m. Wednesday. Futures traders in Taipei were already adjusting implied volatility upward, and margin clerks reported higher inquiry volumes from clients asking about maintenance ratios.
Regulators have not invoked stabilizing measures, but the National Stabilization Fund’s past interventions hang over the market whenever foreign selling exceeds NT$1 trillion in a day. For now, the exchange is treating the session as a global tech de-risking event—painful, but not yet a liquidity crisis.
Retail sentiment surveys
A Taipei brokerage survey of 1,200 margin clients showed confidence in semiconductor earnings still above 60 percent despite Tuesday’s drop, suggesting many retail accounts intend to hold through TSMC’s report rather than join foreign sellers.