Taiwan is preparing emergency measures to restrict short selling and has signaled its readiness to deploy a NT$15 billion support fund after the benchmark TAIEX suffered its worst week since 2001. The response follows a sharp market selloff that pushed the index into bear-market territory and sent shares of Taiwan Semiconductor Manufacturing Co. (TSMC) lower.
According to information shared by Coin Bureau, the emergency short-selling restrictions will take effect on Monday. Taiwan plans to reduce the intraday short-sale limit for borrowed shares and increase the minimum margin requirement, tightening the conditions under which investors can bet against stocks.
TAIEX Records Sharp Intraday Decline
The TAIEX, a markets-cap-weighted benchmark dominated by TSMC, plunged 3,737.67 points, or 9%, intraday on Friday. The decline marked a record point drop during the trading session and reflected the scale of selling pressure across the Taiwanese market.
The index fell below the 40,000 level before reaching 37,837.05, entering a bear market. It also recorded its fourth-largest closing point loss, adding to a week of heavy declines that Coin Bureau described as the market's worst since 2001.
The deterioration in Taiwan followed a broader selloff in artificial intelligence-related stocks, with pressure spreading from Wall Street into Asian markets. The reported market decline placed Taiwan's equity benchmark among the major markets affected by the wider AI-driven downturn.
Taiwan Tightens Short-Selling Rules
Under the emergency measures, Taiwan will lower the intraday short-sale cap for borrowed shares from 30% to 3% of a stock's 30-day average daily volume. The change represents a substantial reduction in the amount of borrowed stock that can be sold short during the trading session.
Authorities will also raise the minimum margin requirement from 90% to 130%. The higher requirement increases the minimum margin investors must maintain for the relevant transactions, while the reduced short-sale cap limits the permitted volume of borrowed shares sold short.
The restrictions are scheduled to begin on Monday. Taiwan has also indicated that it stands ready to deploy a $15 billion fund, although the source post does not specify the fund's deployment timetable or the precise conditions under which it would be used.
TSMC Shares Fall as AI Selloff Reaches Taiwan
TSMC, the largest influence on the market-cap-weighted TAIEX, also came under pressure. Its shares in Taiwan fell 4.46% to NT$2,140 on Friday, following a 10.78% decline in its U.S.-listed shares on Thursday.
The consecutive declines in TSMC's U.S.-listed and Taiwan-traded shares coincided with the broader selloff in AI-related stocks. With TSMC dominating the TAIEX, its share-price movement was an important part of the pressure facing the benchmark.
Taiwan's planned restrictions, alongside its readiness to deploy a $15 billion fund, mark the response outlined after the TAIEX's sharp decline. The emergency short-selling curbs are due to take effect Monday, reducing the borrowed-share cap from 30% to 3% of 30-day average daily volume and increasing the minimum margin requirement to 130%.
Writer: Victoria Hale Technology & Blockchain Writer
Victoria Hale writes about blockchain technology, digital infrastructure, and the intersection of emerging technologies with finance. Her articles explore how new protocols and systems are shaping the evolving digital economy.
She prioritises clarity and accuracy when explaining technical developments to a general audience.
Check out other news and articles on Google News
Disclaimer:
The articles on Hokanews are here to keep you updated on the latest buzz in crypto, tech, and beyond—but they’re not financial advice. We’re sharing info, trends, and insights, not telling you to buy, sell, or invest. Always do your own homework before making any money moves.
Hokanews isn’t responsible for any losses, gains, or chaos that might happen if you act on what you read here. Investment decisions should come from your own research—and, ideally, guidance from a qualified financial advisor. Remember: crypto and tech move fast, info changes in a blink, and while we aim for accuracy, we can’t promise it’s 100% complete or up-to-date.
The articles on Hokanews are here to keep you updated on the latest buzz in crypto, tech, and beyond—but they’re not financial advice. We’re sharing info, trends, and insights, not telling you to buy, sell, or invest. Always do your own homework before making any money moves.
Hokanews isn’t responsible for any losses, gains, or chaos that might happen if you act on what you read here. Investment decisions should come from your own research—and, ideally, guidance from a qualified financial advisor. Remember: crypto and tech move fast, info changes in a blink, and while we aim for accuracy, we can’t promise it’s 100% complete or up-to-date.
