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Taiwan Stocks Face Monthly Support Test as US CPI Data Sparks Rate Hike Fears
Electronic Technology · Semiconductors · economic_daily · 2026-10-15
Taiwan stocks are bracing for a test of monthly support levels after hotter-than-expected US CPI data triggered a sell-off in tech and chip stocks. Investors are now turning their attention to TSMC's upcoming earnings call and positive guidance from ASML.
What Happened
US Inflation Data Triggers Market Volatility: The US September CPI rose 0.6% month-over-month and 3.7% year-over-year, with core CPI up 2.6%, all exceeding market expectations. This data has significantly increased the probability of a Federal Reserve rate hike, while concerns over debt-fueled AI spending led to a sharp decline in US tech and chip stocks, with the Philadelphia Semiconductor Index falling over 4%.
Taiwan Market Braces for Correction: Following the negative lead from Wall Street, Taiwan index futures dropped below the 48,000-point mark in overnight trading, signaling a test of monthly support levels for the local market. Despite ongoing foreign capital outflows, the underlying fundamentals of the Taiwan market remain solid, supported by strong September revenue figures from local enterprises.
Key Industry Catalysts and Technical Outlook: Microsoft's plan to more than double its global data center capacity by 2032 provides a long-term tailwind for the AI supply chain. Furthermore, ASML’s Q3 earnings beat and raised full-year revenue guidance offer a positive outlook for the semiconductor sector, while technical indicators like the RSI suggest underlying buying interest despite short-term pressure at the 49,000-point level.
Strategic Investment Approach: Analysts suggest a cautious "wait and see" approach, recommending investors buy on dips in AI-related stocks, advanced packaging, and semiconductor equipment sectors. Long-term focus should remain on companies with strong revenue momentum, while diversifying into petrochemicals and specialty chemicals to navigate the current high-interest-rate environment.