14 hrs ago
Taiwan Stocks Gain as Kospi Slips After US Fed Hike
The US Federal Reserve raised interest rates by a small amount.
It did this to help control rising prices.
The decision affected two Asian stock markets differently.
South Korea’s Kospi index ended slightly lower.
Taiwan’s TAIEX index ended higher by almost 1%.
Taiwan Semiconductor Manufacturing Company helped support Taiwan’s market.
Investors were interested in the company because demand for computer chips is strong.
The Kospi was hurt by foreign investors selling shares and by a stronger US dollar.
The Federal Open Market Committee unanimously raised the federal funds rate by 25 basis points to 3.75%-4%.
The Kospi opened at 6,779.02, reached 6,795.53, and closed 0.04% lower at 6,715.41.
The TAIEX opened at 45,936, reached 46,874.84, and closed 0.96% higher at 46,288.
Taiwan’s gains were supported by Taiwan Semiconductor Manufacturing Company and strong global chip demand linked to artificial intelligence.
The Kospi was pressured by foreign institutional selling, a stronger US dollar, and heavy foreign fund outflows.
- Who
- The US Federal Reserve, South Korea’s Kospi market, Taiwan’s TAIEX market, foreign investors, and Taiwan Semiconductor Manufacturing Company.
- What
- The Federal Open Market Committee raised interest rates by 25 basis points, while the Kospi declined slightly and the TAIEX gained.
- Where
- The events involved US monetary policy and stock markets in South Korea and Taiwan.
- When
- Thursday, September 17; the article also describes the rate increase as the first such hike since 2023.
- Why
- The Federal Reserve cited sticky inflation intensified by a global energy supply crisis, while Taiwan’s market benefited from chip demand and Kospi trading was weakened by foreign selling and a stronger US dollar.
Kospi performance
TAIEX performance
Market reaction
Kospi performance
The Kospi gave up its early gains and closed 0.04% lower after the US rate decision.
TAIEX performance
The TAIEX also corrected during the second half of trading but finished 0.96% higher.
Main trading drivers
Kospi performance
Foreign institutional selling, a stronger US dollar, and heavy foreign fund outflows weighed on the Kospi.
TAIEX performance
Bullish trading in Taiwan Semiconductor Manufacturing Company and strong global chip demand supported the TAIEX.
Effect of the Fed decision
Kospi performance
The rate hike appeared to weigh on investor sentiment in South Korea.
TAIEX performance
Investors assessed the rate hike, but Taiwan’s market remained supported by technology-sector optimism.
Key facts
- Fed decision
- The federal funds target range was raised to 3.75%-4%.
- Kospi close
- 6,715.41, down 0.04%.
- TAIEX close
- 46,288, up 0.96%.
- Kospi intraday range
- 6,697.85 to 6,795.53.
- TAIEX intraday range
- 45,936 opening level to 46,874.84 high.
- Taiwan market driver
- Taiwan Semiconductor Manufacturing Company accounts for nearly 40% of the index’s weight and benefited from attention to global chip demand.
- Future policy signal
- Recent projections indicated another rate hike could occur in the second half of 2026.
Sources
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