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CTBC Securities: Taiwan Stocks Poised for Rebound After October Sell-off
Finance · Investment Banks/Brokers · economic_daily · 2026-11-02
CTBC Securities suggests that the worst of the recent market correction has passed, recommending investors to accumulate shares in key growth sectors.
What Happened
Market Assessment: Following a 5.6% decline in October due to global headwinds and earnings uncertainty, CTBC Securities believes the primary sell-off phase has concluded. Weekly charts indicate that market volatility is stabilizing, suggesting a potential bottoming out.
Bullish Indicators: The resolution of US election uncertainties and the decline in US Treasury yields are expected to alleviate pressure on equity valuations. Furthermore, strong earnings growth projections for the next two years make the current forward P/E ratio look attractive compared to historical averages.
Historical Context: Data from the past 15 years shows that when the Taiwan market drops by more than 5% in a month, it typically gains an average of 12.5% over the following three months. Analysts view the recent downturn as an opportunity for long-term investors rather than a fundamental collapse.
Investment Strategy: Investors are advised to avoid aggressive bottom-fishing and instead employ a phased entry strategy. Focus should remain on sectors with clear growth outlooks, such as semiconductor foundries, PCB supply chains, AI components, and networking/CPO technologies.