*

Benchmark Taiwan stock market index drops almost 10% as

trading

returns

*

Taiwan president takes to X to promise shared prosperity

with US

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Market had been closed on Thursday and Friday for holiday

*

Circuit breakers triggered for TSMC, Foxconn

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Taiwan imposes short selling curbs to last all week

By Roger Tung and Faith Hung

TAIPEI, April 7 (Reuters) - Taiwan stocks plummeted

almost 10% on Monday in their first trading since the United

States announced new import tariffs last week, as Taiwan

President Lai Ching-te took to X to pledge in English a "golden

age" of shared prosperity with the U.S.

Taiwan, hit with a 32% duty, was singled out by U.S.

President Donald Trump as among the U.S. trading partners with

one of the highest trade surpluses with the country.

After resuming trade on Monday following market holidays

on Thursday and Friday, Taiwan's benchmark stock index

plunged to its lowest level in more than a year and its biggest

one-day percentage drop since at least 1990, according to LSEG

data.

Taiwan on Friday announced a T$88 billion ($2.65 billion)

support package for companies hit by the tariffs, while Lai on

Sunday said the island would buy more from and invest more in

the United States, with the aim of a zero-tariff regime between

the two.

On his X account on Monday, Lai reiterated he did not seek

retaliatory tariffs and that "we'll start talking from bilateral

'zero tariffs'."

"To ensure Taiwan's competitiveness, we'll increase US

imports & adopt other measures. Working together, we'll usher in

a golden age of shared prosperity," he added.

Taiwan has long sought a free trade deal with the United

States.

While semiconductors, Taiwan's main manufacturing

strength, are not included in Trump's tariffs, Taiwan has a

trade-dependent economy highly reliant on its part in the global

electronics supply chain for everything from smartphones to

cars.

Shares in chipmaker TSMC and electronics maker

Foxconn both fell near 10%, triggering the 10% circuit

breaker in the Taiwan market.

"The panic selling pressure is very high," said Venson Tsai,

an analyst at Cathay Futures in Taipei. "This is a problem of

market confidence."

Taiwan's top financial regulator on Sunday announced it

would impose temporary curbs lasting all this week on

short-selling of shares to help deal with potential market

turmoil from the tariffs.

Speaking to reporters shortly after the market opened,

Taiwan Stock Exchange Chairman Sherman Lin said it would

coordinate with the financial regulator to take further

stabilisation steps if needed.

The stock exchange will maintain flexibility in

stabilisation measures this week to handle volatility stemming

from new U.S. import tariffs, Lin added.

He said it would be hard for Taiwan to escape the market

impact of the tariffs, but called on investors to have

confidence in Taiwanese companies and the government.

Allen Huang, a vice president of Mega Financial's

securities investment unit, said in a worst-case scenario, the

chance of a recession could be higher than 50%.

"We're not expecting Trump to change his policy in the near

term," he said.

Goldman Sachs downgraded Taiwan to "underweight" in its

Asian market allocations on Sunday, citing high exposure to U.S.

exports and market sensitivity.

($1 = 33.2020 Taiwan dollars)