Asia Steadies After the Rout as Money Leaves Taiwan

TAIPEI, Oct. 19 — Asia’sAsia’s chip markets opened Monday as if to extend Wall Street’s rout, and then turned. Seoul’s Kospi fell more than 3 percent early in the session and closed up 1.76 percent, at 5,768.01. Taipei’s Taiex, down more than 940 points in early trading, closed 0.61 percent lower, with TSMC unchanged at NT$2,420.

Beneath the closes, money was still leaving Taiwan. Foreign investors sold a net US$19.4 billion of Taiwan shares last week, the Taiwan dollar had its steepest weekly fall in more than a year, and on Monday Taiwan’s central bank said it would step in if the currency stayed volatile.

On Friday the Philadelphia Semiconductor Index fell 3.83 percent, its eighth straight decline, for a loss of 15.7 percent across the eight sessions.

For the makers of the AI build-out’s chips and memory, TSMC in Taiwan and Samsung and SK hynix in South Korea among them, Monday was a reprieve rather than a verdict. In Taiwan the selling had not reversed, a Chinese rival had forecast nearly $20 billion of profit for nine months, and the next quarterly results from American chip companies are two days away. Tokyo’s Nikkei 225 closed down 0.62 percent, at 64,916.70, with Tokyo Electron, a maker of chipmaking equipment, down 2.6 percent.

In Seoul the buying came from institutions, which bought a net 955.8 billion won of shares on the main board, and from foreign investors, who bought a net 548.5 billion won, according to Korea Exchange data reported by Financial News. Individuals sold a net 1.93 trillion won. Samsung Electronics closed up 1.16 percent, at 218,000 won, and SK hynix up 0.39 percent, at 1,277,000 won.Far From JuneThe Kospi crossed 9,000 in June, at its peak. Even after Monday’s gain it was down more than 17 percent over the past month, AP reported.

In Taipei the recovery came late. Bargain hunters became active as the Taiex approached its 60-day moving average of 46,089 points, said Kerry Huang, an analyst at Concord Securities, as quoted by CNA, Taiwan’s national news agency. TSMC accounts for more than 40 percent of the market’s total capitalization. “Judging from TSMC’s rebound, I suspect government-backed funds stood on the buy side,” Mr. Huang said. TSMNYSE406.13▼25.68−5.9%Taiwan Semiconductor · Friday’s session Nanya Technology, a memory maker, closed down 2.57 percent.

The Currency

Foreign institutional investors were net sellers of NT$76.74 billion of Taiwan shares on Monday, according to the Taiwan Stock Exchange. Last week’s net fund outflows from Taiwan came to US$17.96 billion, CNA reported, and the Taiwan dollar fell NT$0.463 against the U.S. dollar, to NT$32.338 at Friday’s close.

In a statement on Monday, the central bank said the currency’s losses largely reflected the slump in local stocks amid global financial volatility and foreign investors sending funds out of Taiwan. It said it may intervene when necessary to maintain the Taiwan dollar’s dynamic stability. The currency slipped again on Monday, as the U.S. dollar closed up NT$0.107, at NT$32.445.By ComparisonThe central bank noted that the Taiex fell 5.4 percent from Oct. 7 to 16, while the Philadelphia index fell 15.7 percent over the same period.

The Rival

In Shanghai, a strong profit forecast met a falling share price. CXMT, China’s leading memory chipmaker, forecast a net profit of 131 billion to 132.5 billion yuan, about $19.6 billion to $19.8 billion, for the first nine months of the year, Bloomberg reported on Friday, citing a preliminary filing with the Shanghai Stock Exchange. A year earlier it lost 5.3 billion yuan. It expects revenue of 265 billion to 270 billion yuan, against 32.1 billion a year earlier. On Monday its shares fell more than 7 percent, AP reported.

The company credited demand for AI computing, which has lifted the global market for DRAM since the second half of 2025, along with added capacity and more chips from each silicon wafer, TNW and Bloomberg reported.CXMTCXMT listed in Shanghai in July, and its shares rose 466 percent on the first day. Its market value was about 3.06 trillion yuan at Friday’s close, TNW reported. CXMT has also said it achieved a breakthrough in chip technology that rivals such as Samsung had pursued for years, Bloomberg reported.

South Korea’s finance minister sees no turn in the cycle yet. “For now, our view is that we can sustain this growth at least through next year,” the minister, Lee Hyoung-Il, told CNBC on Saturday, on the sidelines of the IMF-World Bank annual meetings in Bangkok. “That’s because the gap between demand and supply for semiconductors is still very wide, and supply is still being expanded.” Not every voice in Seoul agrees: a column in Maeil Business Newspaper on Thursday said two experts expect a “flood of new supply” of semiconductors to turn the memory market “into a red ocean” by 2029, in CNBC’s translation.

For now, our view is that we can sustain this growth at least through next year.

A weekend report suggested a closer tie between Seoul’s memory makers and Taipei’s foundry. Samsung will use TSMC’s 3-nanometer process to make the base dies for Nvidia’s next custom high-bandwidth memory, the Seoul Economic Daily reported on Sunday, citing industry sources, as relayed by Reuters; Nvidia has asked SK hynix and Micron to do the same, the newspaper said. The report is unconfirmed, and Reuters’s account carried no comment from the companies.The Base DieNvidia’s custom memory, NVHBM, unveiled in August, puts Nvidia’s own memory controller in the base die and is aimed at standardizing implementation across memory suppliers, Reuters reported, citing Nvidia.

Early Monday in New York, futures on the Nasdaq 100 and the S&P 500 pointed higher, with Nasdaq 100 contracts rebounding after a 5.5 percent fall last week, Bloomberg reported. A decline in the semiconductor index on Monday would be its ninth in a row; in Nasdaq’s daily closes since 2005, by this paper’s count, it has fallen nine sessions running only once, from May 8 to 18, 2006.

The next quarterly results come on Wednesday, when Texas Instruments, Lam Research, a maker of chipmaking equipment, and IBM hold their earnings calls. SK hynix holds its third-quarter call on Oct. 28, Seoul time, and Samsung Electronics on Oct. 29. In Taipei, Mr. Huang put it plainly: “How the Taiex performs will hinge on the U.S. markets.”