Market views· Sector Analyst
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The Taiwan market exhibits defensive sectors outperforming cyclical sectors amid an overall slowdown in momentum. Sector rotation momentum is decelerating to an average of -1.85%, with defensive sectors showing an average Relative Strength (RS) of +0.64%, outperforming cyclical sectors' average of -1.98%. Notably, the Financials sector (0055) demonstrates strong relative strength against the benchmark across all timeframes, reflecting the market's conservative sentiment.
Action: Given the broad market momentum slowdown and defensive sector strength, maintain a conservative portfolio, focus on defensive sectors with strong relative strength, and approach cyclical sectors with caution.
| # | Type | |||||
|---|---|---|---|---|---|---|
| 1 | Financials 0055 | DEF | +4.12% | +13.79% | +25.45% | −5.30 |
| 2 | Technology 0052 | CYC | −0.33% | −0.68% | −2.16% | +0.57 |
| 3 | Semiconductor 00891 | CYC | −1.53% | −2.71% | −7.89% | +2.00 |
| 4 | Green Energy 00896 | DEF | −2.85% | −6.42% | −5.62% | −4.48 |
| 5 | 5G/Telecom 00881 | CYC | −4.08% | −6.23% | −13.97% | −2.06 |
Expect stable performance amid market uncertainty due to strong relative strength and defensive characteristics.
Exhibits the largest decline in relative strength and negative momentum across all timeframes, with continued weakness anticipated.
Recovery is expected to be slow due to persistent relative strength weakness and negative momentum.
Risk management is required due to persistent relative strength weakness and high volatility driven by market headlines.
The financial sector is significantly outperforming the benchmark, recording strong relative strength of +4.12% over 20 days, +13.79% over 60 days, and +25.45% over 120 days. Although momentum has slightly decelerated to -5.30%, its defensive characteristics and sustained strength continue to serve as a safe haven amid market uncertainty.
The technology sector is showing slight underperformance relative to the benchmark, with returns of -0.33% over 20 days, -0.68% over 60 days, and -2.16% over 120 days. However, momentum has turned positive at +0.57%, suggesting potential short-term stabilization or a rebound.
The semiconductor sector continues to exhibit weakening relative strength, with returns of -1.53% over 20 days, -2.71% over 60 days, and -7.89% over 120 days. Volatility remains high, as indicated by market headlines regarding uncertainty surrounding the NVIDIA CEO and TSMC stock fluctuations. While momentum is positive at +2.00%, it is insufficient to offset the overall weakness.
The green energy sector continues to underperform the benchmark, with returns of -2.85% over 20 days, -6.42% over 60 days, and -5.62% over 120 days. Momentum remains negative at -4.48%, indicating that the sector is losing market interest despite its defensive nature.
The 5G/Telecom sector has recorded the steepest decline in relative strength across all periods, with returns of -4.08% over 20 days, -6.23% over 60 days, and -13.97% over 120 days. Momentum is also negative at -2.06%, indicating it is one of the most vulnerable sectors amid the broader market weakness.
Market rotation is shifting from cyclical sectors to defensive sectors.
As overall sector rotation momentum decelerates to an average of -1.85%, defensive sectors' average relative strength of +0.64% outperforms cyclical sectors' average of -1.98%. This is clearly evidenced by the Cyclical vs. Defensive spread recording -2.62%, highlighting the relative strength of defensive sectors.
Key driver: Rising market uncertainty and risk-averse sentiment are the key drivers.
Sector ETF prices relative to 0050 from AlphaLenz's daily price database, 15 Nov 2026.