Taiwan's leading chip packaging and testing company ASE is stepping up equipment purchases in preparation for capacity expansion — good news for semiconductor demand — but the broader Taiwan stock market fell sharply that day amid very poor investor sentiment.

• The board of ASE Semiconductor approved the purchase of automated optical inspection equipment from affiliated company Machvision, with total transactions over a one-year period worth about NT$334 million, citing business growth and insufficient machine capacity.
• Taiwan's benchmark index closed down 755 points, or 1.61%, at 46,184, slipping below the 47,000 level for the second consecutive day.
• The main cause of the decline was the continued surge in long-dated government bond yields worldwide. A lacklustre U.S. 30-year Treasury auction pushed the 10-year yield above 4.96%, forcing institutional investors to rebalance their asset allocations and dragging equity valuations lower.
• International oil prices broke through US$100 overnight and U.S. stocks closed lower for a fourth straight day, with markets beginning to worry about another round of inflation.
• Memory maker Micron issued its highest-ever compensation package in Taiwan, a NT$1 million appreciation bonus per employee, but the union questioned whether the figures were a numbers game, and the chairman has called an emergency employee assembly.

Outlook: As long as bond yields and oil prices keep rising, Taiwan stocks are likely to remain under pressure in the near term, though demand for semiconductor capacity expansion itself remains intact.