TAIEX ends be­low 9,900 points, elec­tron­ics shares slide

The China Post - - TAIWAN BUSINESS -

Shares in Tai­wan ended be­low the 9,900-point mark Wed­nes­day as the bell­wether elec­tron­ics sec­tor came un­der pres­sure on worsethan-ex­pected first quar­ter re­sults and dis­ap­point­ing out­looks for the sec­ond quar­ter, deal­ers said.

The fi­nan­cial sec­tor also suf­fered a sell- off as in­vestors rushed to lock in gains they built in re­cent ses­sions, fur­ther drag­ging down the in­dex at the close, they said.

Mar­ket sen­ti­ment turned cau­tious as many in­vestors pre­ferred to stay on the side­lines be­fore the U. S. Fed­eral Re­serve was to wrap up a two- day pol­i­cy­mak­ing meet­ing later in the day, they added.

The weighted in­dex on the Tai­wan Stock Ex­change closed down 103.00 points, or 1.03 per­cent, at 9,853.83, af­ter mov­ing be­tween 9,842.50 and 9.978.87, on turnover of NT$113.76 bil­lion (US$3.73 bil­lion).

Elec­tron­ics Shares Fac­ing

Pres­sure

The mar­ket opened down 0.29 per­cent as metal cas­ing maker Catcher Tech­nol­ogy Co. ( ) faced a sell-off on dis­ap­point­ing first quar­ter re­sults and smart­phone ven­dor HTC Corp. ( ) came un­der pres­sure on dis­ap­point­ing guid­ance for the sec­ond quar­ter, deal­ers said.

Sell­ing then ex­tended to other high-tech stocks amid con­cerns that a strong Tai­wan dollar will af­fect the elec­tron­ics sec­tor’s bot­tom line. The down­ward pres­sure even dragged down the fi­nan­cial sec­tor to pull the broader mar­ket be­low 9,900 points, they said.

“Af­ter the mar­ket’s strong show­ing in the past few ses­sions, in­vestors sim­ply seized on the earn­ings re­ports as an ex­cuse to pocket their gains,” Con­cord Se­cu­ri­ties an­a­lyst Kerry Huang said.

“With the in­dex re­peat­edly breaching the 10,000-point level but fail­ing to close above that level, it’s no sur­prise that the lo­cal bourse will need some time to con­sol­i­date be­fore post­ing more gains,” Huang said.

Catcher Fell 7%

In the elec­tron­ics sec­tor, which closed down 1.71 per­cent, Catcher fell 7 per­cent, the max­i­mum daily decline, to end at NT$350.00, with 13.12 mil­lion shares chang­ing hands.

The stock plunged to the day’s low early in the ses­sion and its weak­ness con­tin­ued to the end af­ter it an­nounced that it posted NT$6.04 in earn­ings per share (EPS) for the first quar­ter, lower than a mar­ket con­sen­sus of NT$6.2.

“Af­ter to­day’s sell-off, shares of Catcher, a sup­plier to Ap­ple Inc., have turned tech­ni­cally weaker. Cau­tion over its per­for­mance in the sec­ond quar­ter could trig­ger more sell­ing un­til the stock moves closer to the near­est tech­ni­cal sup­port of NT$325-NT$330,” Huang said.

Sell­ing in Catcher also af­fected other Ap­ple sup­pli­ers. Hon Hai Pre­ci­sion In­dus­try Co. ( ), the iPhone and iPad as­sem­bler, lost 1.60 per­cent to close at NT$92.10, and smart­phone cam­era lens maker Lar­gan Pre­ci­sion Co. (

) closed 2.50 per­cent lower at NT$3,120.00.

HTC lost 5.70 per­cent to close at NT$124.00 af­ter the smart­phone ven­dor fore­cast its EPS for the sec­ond quar­ter at be­tween NT$0.06 and NT$0.34, much lower than a fore­cast of NT$1.89 by for­eign bro­ker­ages.

Fears on New Tai­wan Dollar’s

Ap­pre­ci­a­tion

“In ad­di­tion to the dis­ap­point­ing re­sults, in­vestors have fears that the New Tai­wan dollar’s ap­pre­ci­a­tion will have an ad­verse im­pact on the ex­port-ori­ented elec­tron­ics sec­tor,” Huang said.

The fi­nan­cial sec­tor closed down 1.07 per­cent, with Cathay Fi­nan­cial Hold­ing Co. ( ) slid­ing 1.62 per­cent to end at NT$54.60 and Mega Fi­nan­cial Hold­ing Co. (

) fall­ing 1.25 per­cent to close at NT$27.70.

“The Fed’s meet­ing has turned many in­vestors away from the mar­ket,” Huang said. “We have to pay close at­ten­tion to the Fed’s com­ments on the eco­nomic cli­mate for more clues about when it will raise in­ter­est rates.”

CNA

A man is seen sit­ting in front of stock in­di­ca­tors at a bro­ker­age in Taipei, yes­ter­day. The lo­cal mar­ket closes down 103 points yes­ter­day. The weighted in­dex on the Tai­wan Stock Ex­change ended up at 9853.83 points on turnover of NT$113.76 bil­lion (US$3.73 bil­lion).

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