Shares show lit­tle change; while fi­nan­cials up on new trad­ing rules

The China Post - - TAIWAN BUSINESS -

Shares in Tai­wan closed lit­tle changed Fri­day amid lin­ger­ing con­cerns over the debt prob­lems in Greece as in­vestors feared that global fi­nan­cial mar­kets would reel back from pos­si­ble neg­a­tive leads from the on­go­ing debt talks in the eu­ro­zone, deal­ers said.

Against the dol­drums in the broader mar­ket, the fi­nan­cial sec­tor moved higher in the wake of a move by the Fi­nan­cial Su­per­vi­sory Com­mis­sion (FSC, ) to re­move the ceil­ing on the value of credit trad­ing — mar­gin trad­ing and se­cu­ri­ties bor­row­ing — as part of its ef­forts to boost ac­tiv­ity in the lo­cal eq­uity mar­ket, the deal­ers said.

The weighted in­dex on the Tai­wan Stock Ex­change ended down 0.56 points, or 0.01 per­cent, at 9,301.93, af­ter mov­ing be­tween 9,263.41 and 9,339.33, on turnover of NT$81.74 bil­lion ( US$2.65 bil­lion).

The mar­ket opened down 7.66 points and fell to the day’s low as in­vestors locked in their gains posted in the pre­vi­ous two ses­sions, and with the in­dex fall­ing be­low 9,300 points, some bar­gain hunt­ing emerged to push the mar­ket into pos­i­tive ter­ri­tory be­fore fall­ing back at the close, the deal­ers said.

“It was a quiet ses­sion af­ter the in­dex fluc­tu­ated in a nar­row range through­out the day,” Con­cord Se­cu­ri­ties an­a­lyst Kerry Huang said, re­fer­ring to the turnover, which fell be­low NT$90 bil­lion.

“Judg­ing from the thin trad­ing vol­ume, I think that many in­vestors were re­luc­tant to jump into the mar­ket at a time when no so­lu­tion has been ham­mered out for the debt prob­lems in Greece,” Huang said.

A spokesman for the In­ter­na­tional Mon­e­tary Fund told re­ports that there were still “ma­jor dif­fer­ences” in the fi­nan­cial aid ne­go­ti­a­tions be­tween debt-rid­den Greece and its cred­i­tors.

Fears on Greece Debt

“The com­ments have raised fears over a de­fault by Greece on its mas­sive debt. In­vestors ei­ther kept their hands off the mar­ket or pock­eted their gains when the in­dex rose,” Huang said.

He said that the fi­nan­cial sec­tor at­tracted bar­gain hun­ters af­ter the FSC an­nounced a day ear­lier that it will re­move the cap on credit trad­ing value from June 29. The fi­nan­cial sub-in­dex ended up 0.55 per­cent, out­per­form­ing the broader mar­ket.

“The FSC an­nounce­ment showed that the gov­ern­ment is con­tin­u­ing its ef­forts to come up with pos­i­tive leads for the eq­uity mar­ket,” Huang said. “Although it re­mains to be seen whether the new rules will boost turnover, in­vestor sen­ti­ment to­ward the fi­nan­cial sec­tor has im­proved.”

Among the gain­ing fi­nan­cial stocks, Mega Fi­nan­cial Hold­ing Co. ( ) gained 1.46 per­cent to close at NT$27.80 and E. Sun Fi­nan­cial Hold­ing Co. ( ) rose 1.95 per­cent to end at NT$20.95.

Elec­tron­ics Sub-in­dex

The elec­tron­ics sub-in­dex closed up 0.11 per­cent, with large-cap stocks mixed. Tai­wan Semi­con­duc­tor Man­u­fac­tur­ing Co. ( ), the most heav­ily weighted stock in the lo­cal mar­ket, rose 0.70 per­cent to close at NT$144.50, while Hon Hai Pre­ci­sion In­dus­try Co. ( ), an iPhone and iPad as­sem­bler, fell 0.84 per­cent to end at NT$95.00.

In the old econ­omy sec­tor, For­mosa Plas­tics Corp. ( ) shed 1.49 per­cent to close at NT$72.80 and food maker Uni- Pres­i­dent En­ter­prises Corp. ( ) lost 1.14 per­cent to end at NT$52.20.

In ad­di­tion to the Greece debt sit­u­a­tion, “in­vestors should watch closely the up­com­ing pol­icy-mak­ing meet­ing sched­uled by the U.S. Fed­eral Re­serve for next week to get more clues about changes in the Fed’s mon­e­tary mea­sures,” Huang said.

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