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Taiwan to activate $15 billion stock stabilisation fund after market rout

By Reuters News

TAIPEI, Nov 6 (Reuters) - Taiwan will activate its $15 billion stock stabilisation fund, the finance ministry said on Friday, following a market rout as investors dumped chipmakers in a global selloff and Taiwan equities booked their worst week since 2001.

Here are some details from the ministry's statement and the market situation:

  • Taiwan's benchmark share index .TWII has seen "dramatic swings recently and foreign investors have continued to sell heavily, showing "clearly insufficient market confidence", the ministry said

  • Tech stocks globally have endured a selloff this week as investors grappled with uncertainty over AI stocks after Democrats took control of the US Congress

  • Tech-focused and export dependent Taiwan is home to TSMC 2330.TW, the world's largest contract chipmaker and supplier of most the advanced chips powering the trend towards AI

  • The government-run stabilisation fund has some T$500 billion ($15.18 billion) in assets that can bolster Taiwan stocks in times of crisis. It has previously been used during other moments of uncertainty, including the start of the COVID pandemic

  • Given the high degree of uncertainty in international political and economic conditions, the National Stabilisation Fund's management agreed to use funds as circumstances warrant to carry out market stabilisation operations

  • Taiwan's financial regulator said separately it will institute some short-selling curbs, adding that it also encourages listed companies to evaluate the possibility of buying back their stock when appropriate



($1 = 32.9330 Taiwan dollars)

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