Taiwan FSC Monitors Stock Volatility as State-Owned Banks Focus on AI Supply Chain

The continuing conflict in the Middle East has intensified demand for safe-haven assets among international investors, driving volatility in Taiwan stocks. The Financial Supervisory Commission is continuing to review two indicators—the maintenance ratio for margin trading collateral and the ratio of short sales through securities borrowing—to gauge forced margin selling and short-selling pressure. It said Taiwanese corporate earnings and market fundamentals remain sound.

In response to the pullback triggered by developments in the Middle East, state-owned banks are dynamically adjusting their Taiwan equity positions in the second quarter, focusing on supply chains for AI ASICs, AI servers and advanced processes. The FSC is also closely monitoring market volatility. Available information on the event does not disclose when individual banks made adjustments, the amounts invested or the readings of the two monitoring indicators.