【Taiwan Stock Reform】Taiwan Stock Exchange Research Extends Trading Hours to 3:30 PM to Align with International Standards, or Maybe Do Away with the Lunch Break

Taiwan's capital market may be on the verge of a major transformation. Lin Hsiu-ming, Chairman of the Taiwan Stock Exchange (TWSE), revealed on Wednesday (1st) at the Finance Committee meeting that the current trading hours for Taiwanese stocks are relatively short compared to other major Asian markets, and "extending trading hours is a direction being studied." He stated that the exchange is in close communication with local securities firms, with a preliminary assessment that trading hours could be extended by one to one and a half hours, meaning the closing time could potentially be pushed back significantly from the current 1:30 PM to 3:30 PM.

If the plan is implemented, this would be the first major adjustment in over 20 years since Taiwan stocks extended intraday trading hours to 1:30 PM in 2001.

Lin pointed out that Taiwan stocks are highly correlated with U.S. stocks, especially the performance of tech giants like Nvidia (NASDAQ: NVDA), which often influences the Taiwan electronics sector. To make it more convenient for international investors to participate, extending trading hours has two core key points:

• Maintaining "continuous trading without a lunch break": Neighboring Japan and Hong Kong both have a midday break, but Lin revealed that most local securities firms prefer to maintain the current Taiwanese trading model of "no lunch break, continuous trading from open to close."

• IT system capacity: Extending trading hours will primarily impact the back-office operations of securities firms and the tolerance of their IT systems.

Financial Supervisory Commission emphasizes alignment, not blind imitation

Peng Chin-lung, Chairman of Taiwan's Financial Supervisory Commission (FSC), stated that aligning with international standards does not mean that trading hours or tax systems must be exactly the same as other countries. Taiwan is already an international-level capital market, and the key is that the trading system should align with the trading habits of international investors. He also emphasized that since this move involves a disruptive change to the entire market system, securities firm operations, and investor habits, the TWSE has already proposed multiple plans, and further progress will require social consensus before advancing.

Benefiting from strong performance this year, Taiwan's securities transaction tax revenue for the first half of the year has already reached NT$330 billion. The market expects that extending trading hours could further boost trading volume and stimulate "securities transaction tax" revenue.