Taiwan stocks fell more than eight percent Monday as global markets tanked after poor US jobs data fuelling recession fears.

The sell-off followed another hefty day of losses on Wall Street, where heavyweight tech firms took the brunt owing to worries an AI-fuelled rally this year may have been overdone.

The Taiex, the weighted index on the Taiwan Stock Exchange dived 8.35 percent, or 1,807.21 points, to 19,830.88 by the close, with market-heavyweight chip giant TSMC off more than nine percent.

In a press conference Monday, stock exchange president Chien Lih-chung urged investors "to have confidence and not to panic". 

"Taiwan stocks are very closely linked to the international stock market and we have also been affected to a certain degree. But Taiwan's capital market, especially our listed companies' operating fundamentals, are quite strong," he said. 

He added that the exchange would pay close attention to market movements. 

"We also hope to cooperate with the relevant measures of the authorities in charge in the future to continue to maintain the stability of our capital market," Chien said.

TSMC has been boosted this year by a frenzy to snap up firms linked to artificial intelligence.

That helped the company to briefly pass the US$1 trillion market capitalisation mark in July, putting it ahead of Tesla as the seventh most valuable technology firm.

But the AI-fuelled drive has also stoked speculation that valuations for tech stocks are far too high and a correction could be on the cards.