Stocks and exchanges have two different feelings! Taiwan stocks counterattacked strongly by more than 2,000 points, and the New Taiwan dollar once fell by 1.69 cents.
The rebound of U.S. chip stocks and the stabilization of the national security fund drive Taiwan stocks, but the strength of the U.S. dollar puts pressure on the exchange rate of the New Taiwan dollar
Quick Look
- Driven by the rebound of U.S. chip stocks, the National Security Fund's launch of market stabilization measures, and the Financial Supervisory Commission's short-term restriction measures, Taiwan stocks surged by more than 2,000 points and returned to 41,000 points; the New Taiwan dollar fell to 32.937 yuan against the U.S. dollar in early trading, depreciating by 1.69 cents, and then restrained its losses.
- The market is paying attention to the probability of the Federal Reserve raising interest rates in December and this week's U.S. inflation data.
- Huida's board of directors will also investigate Huang Renxun's becoming a target of Chinese espionage.
AI-generated summary
Why It Matters
The rebound of U.S. chip stocks drove Taiwan stocks, the National Security Fund launched market stabilization measures, and the Financial Supervisory Board implemented short-term restrictions; at the same time, U.S. non-farm employment was better than expected, and the market was betting that the Federal Reserve would raise interest rates in December, and the U.S. dollar strengthened. This week, the market will focus on the U.S. CPI and PPI inflation data in October and the speech by Federal Reserve Governor Waller. Huida's board of directors will also investigate Huang becoming a target of Chinese espionage.
Stocks and exchanges have two different feelings! Taiwan stocks counterattacked strongly by more than 2,000 points, and the New Taiwan dollar once depreciated by 1.69 cents (photo by reporter Chen Meiying)
[Reporter Chen Meiying/Report from Taipei] The rebound of U.S. chip stocks, coupled with the National Security Fund's launch of market stabilization measures and the implementation of short-term restriction measures by the Financial Supervisory Commission, led to a counterattack by Taiwanese stocks. It has soared by more than 2,000 points and returned to 41,000 points. However, the New Taiwan dollar is against the US dollar. On the one hand, the exchange rate digested the overselling of foreign capital last Friday, and on the other hand, U.S. non-farm employment was better than expected. The market is betting that the Federal Reserve will raise interest rates in December, and the U.S. dollar is strengthening. The New Taiwan dollar first fell to 32.937 yuan in early trading, and then returned to 32.8 yuan.
U.S. chip stocks rebounded sharply last Friday, with TSMC's ADR rising 6.33%, spurring Taiwanese stocks to surge on Monday. However, the U.S. non-agricultural sector added 165,000 people and the unemployment rate fell to 4.1%. After the data was released, the market had a nearly 80% chance of the Fed raising interest rates by 1% in December, which caused the U.S. dollar index to rise again and U.S. bond yields to rebound for a time.
The director of Huiyin said that after the exchange rate of the New Taiwan dollar fell below 33 yuan last Friday, exporters entered the market in large numbers, causing the exchange rate of the New Taiwan dollar to rise from the depreciation. However, the short-term exchange rate trend is still dominated by foreign capital. Since foreign capital sold more than Taiwanese stocks by nearly 100 billion yuan last Friday, some foreign capital adopted the T+1 method, and funds were released on Monday morning. The remittance caused the New Taiwan dollar exchange rate to open lower in early trading, hitting an intraday low of 32.937 yuan, down 1.69 cents. With the strong counterattack of Taiwanese stocks, some foreign capital also came in, and the decline in the exchange rate subsequently converged. Whether the exchange rate will further stabilize in the afternoon still depends on the trends of foreign capital and the situation of exporters selling foreign exchange.
In addition, this week the market will focus on the release of U.S. inflation data such as CPI and PPI in October as well as Fed Governor Waller’s economic outlook speech. Waller previously said that if economic data is in line with expectations, further interest rate increases will still be necessary. After non-farm payrolls in October were better than expected, the market will be watching whether he releases a clearer signal to raise interest rates in December and how to assess the impact of falling oil prices on inflation.
Huida's board of directors will launch an investigation into Huang Renxun becoming a target of Chinese espionage, which is also the focus of attention from all walks of life. The board of directors stated that there is currently no reason to believe that U.S. national security or Huida’s secrets have been compromised, and the subsequent market reaction remains to be seen.
What to Watch
AI outlook — possibilities, not facts
In the short term, the exchange rate of the New Taiwan dollar will continue to be affected by foreign investment trends and exporters' foreign exchange sales, and the fluctuations will continue.
Likely · Within days
The market will continue to pay attention to the probability of the Federal Reserve raising interest rates in December and U.S. inflation data
Likely · Within weeks
Open Questions
- Will the New Taiwan dollar exchange rate further stabilize in the afternoon?
- Will Fed Governor Waller send a clearer signal to raise interest rates in December?
- The specific progress and results of Huida’s board of directors’ investigation into Huang Renxun’s spy target
