Taiwanese IC substrate maker Unimicron was searched by prosecutors and investigators over alleged "origin laundering," sending its shares limit down at the open. Combined with hawkish signals from the U.S. Federal Reserve, Taiwan's stock market slumped across the board — bad news for investors.

• Prosecutors and investigators searched Unimicron, probing product origin labelling and offences of obstructing agriculture, industry and commerce. Fourteen people were summoned for questioning and five released on bail.
• Unimicron shares gapped down to the limit at NT$999, falling below the NT$1,000 mark, with sell orders piling up beyond 110,000 lots.
• The company issued an urgent statement stressing that the products in dispute are ordinary printed circuit boards, not its core ABF substrate business.
• Remarks by Fed Chair Warsh leaned hawkish, stoking market concerns about rate hikes. U.S. chip stocks fell first, with TSMC, MediaTek and Hon Hai weakening in step, and Taiwan's index at one point down more than 500 points.
• Panel maker Innolux has lost a third of its value from its peak within two months, leaving investors who chased the highs trapped.

Outlook: Markets will now be watching how much shipment volume and how many customers the origin dispute actually involves, the real impact on Unimicron's revenue, and the Fed's interest rate decision in September.