Free Trial
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
ASIA
- In the past 6 months, the dramatic tightening in financial conditions combined with the surge in stagflation risks have been weighing on US mega-cap growth stocks.
- The FANG+ Index is down nearly 40% since its early November highs, and investors struggle to see the bottom in markets as global outlook keeps worsening.
- We previously saw that due to its heavy semi-conductor component, Taiwanese equities have been trading like US-tech equities and therefore have historically been very sensitive to the liquidity dynamics.
- As for the mega-cap growth stocks, Taiwan equities have been strongly driven by the significant rise in liquidity from major central banks in the past cycle.
- The chart below shows the strong co-movement between US growth stocks and Taiwan equities in recent years.
- The peak in US growth stocks in November 2021 was shortly followed by a peak in Taiwanese equities a few weeks later.
- TWSE is down over 12% since its all-time high reached in early January.
- Hence, with liquidity drying up (Fed to start QT) and market uncertainty remaining elevated, Taiwan equities remain vulnerable in the near term.
Source: Bloomberg/MNI
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
We are facing technical issues, please contact our team.
ok
Your request was sent sucessfully! Our team will contact you soon.
ok