Taiwanese stocks fall after Joe Biden drops out of US presidential race

Last week, the dynamics of the stock market were largely determined by the statements of US presidential candidate Donald Trump, who considered it inappropriate to support Taiwan on existing terms. With Joseph Biden dropping out of the race, investor sentiment on the Taiwan stock market further deteriorated on Monday morning.

Image Source: ASE Technology

As the Nikkei Asian Review reported, after the opening of trading on the Taipei stock exchange, the local Taiex stock index fell to 3.04% at its peak, although since the beginning of this year it has grown by almost 28%. TSMC shares were down more than 3% this morning, rival UMC saw a similar decline, and fellow company ASE Technology Holding saw its stock price drop more than 4%. Taiwan’s largest processor developer MediaTek showed a decline in its own stock price by more than 5%.

Foxconn shares on the Taiwan stock market lost almost 6% in price, largely due to their special connection with the political initiatives of Donald Trump when he was President of the United States. As part of his campaign to bring advanced manufacturing back to the country, Trump brought Foxconn on board to build a facility in Wisconsin, but the timeline was continually renegotiated, the project was scaled back, and the project was eventually reprofiled, but the project never came to fruition.

According to analysts surveyed by Nikkei, the fall in stock prices of Taiwanese technology companies is caused by increased geopolitical uncertainty regarding the future fate of the region. In addition, recently, in the wake of the artificial intelligence boom, the quotes of many shares of companies in the technology sector have been growing too actively, and therefore, against the backdrop of the emergence of potentially negative factors, some correction is being observed. Even at the beginning of the month, large institutional investors began to withdraw their funds from the assets of Taiwanese companies, and speculators and private investors who remain in the game are reacting more sharply to market sentiment, so fluctuations in quotes will only intensify. However, some experts are convinced that in the long term, the Taiwanese technology industry will continue to develop at a stable pace.