On Monday, the Taiwan stock market concluded a five-day winning streak, during which it had advanced over 1,000 points, equating to a 4.5% gain. Presently, the Taiwan Stock Exchange hovers just below the 22,700-point mark and is anticipated to open on a downward trend on Tuesday.
The forecast for Asian markets appears bleak, primarily due to ongoing concerns about tariffs and their potential impact on interest rates. Following declines in both European and U.S. markets, it is expected that the Asian markets will follow suit.
The TSE experienced a significant downturn on Monday, largely impacted by losses in technology, cement, and plastics sectors, although financial stocks did offer some support.
By the close of the day, the index had dropped 830.70 points, or 3.53%, closing at 22,694.71, after fluctuating between a range of 22,502.20 and 22,796.71.
Amongst the actively traded stocks, Cathay Financial edged up 0.17% and Mega Financial rose by 1.16%. First Financial and E Sun Financial both appreciated by 0.72%, while Fubon Financial decreased by 1.51%. Taiwan Semiconductor Manufacturing Company saw a steep decline, falling by 5.73%, whereas United Microelectronics Corporation rose by 0.75%. Hon Hai Precision experienced a substantial drop of 8.06%, in contrast, Largan Precision climbed 2.91%. On the other hand, Catcher Technology fell by 0.75%, MediaTek surged 2.39%, yet Delta Electronics plummeted 8.80%. Additionally, Novatek Microelectronics increased by 1.91%, but Formosa Plastics fell 4.97%, Nan Ya Plastics decreased 3.40%, and Asia Cement dropped 0.97%. CTBC Financial remained unchanged.
Wall Street set a subdued tone as major indices opened negatively on Monday and predominantly maintained that trajectory, despite recovering from session lows.
The Dow Jones Industrial Average fell 122.75 points, or 0.28%, ending at 44,421.91. Meanwhile, the NASDAQ tumbled 235.49 points, or 1.20%, closing at 19,391.96, and the S&P 500 declined by 45.96 points, or 0.76%, concluding at 5,994.57.
The sharp decline in stock prices at the start of trading was driven by apprehensions of a global trade conflict. This follows President Donald Trump's imposition of a 25% tariff on imports from Canada and Mexico, alongside a 10% tariffs on imports from China. Trump also alluded to potential tariffs against the United Kingdom and the European Union, marking a significant escalation in trade tensions.
In retaliation, Canada and Mexico announced tariffs on American goods, with China pledging countermeasures. The EU warned of strong retaliation if targeted.
Investors are concerned that a trade war may negatively affect corporate profits and impede global economic growth. Additionally, the tariffs could reignite inflation concerns, prompting the Federal Reserve to maintain interest rates for an extended period.
In commodity markets, oil futures closed higher on Monday. The newly imposed tariffs by Trump on imports from Canada pose a threat to the cohesively integrated North American oil market. West Texas Intermediate Crude oil futures for March closed at $73.16 per barrel, marking an increase of $0.63, or approximately 0.87%.
