Tai­wan shares re­bound, led by fi­nan­cial, old econ­omy stocks

The China Post - - TAIWAN BUSINESS -

Shares in Tai­wan staged a re­bound Wed­nes­day as bar­gain hun­ters rushed to pick up fi­nan­cial and old econ­omy stocks, while the bell­wether elec­tron­ics sec­tor re­mained slow amid lin­ger­ing con­cerns over global de­mand in the third quar­ter, deal­ers said.

De­spite the stag­nant high-tech sec­tor as a whole, se­lect blue chips, such as smart­phone cam­era lens sup­plier Lar­gan Pre­ci­sion Co. (

) and me­tal casing maker Catcher Tech­nol­ogy Co. ( ) bounced back from mas­sive losses seen in re­cent ses­sions, they said.

The weighted in­dex on the Tai­wan Stock Ex­change closed up 31.41 points, or 0.36 per­cent, at 8,542.27, af­ter mov­ing be­tween 8,486.27 and 8,563.01, on turnover of NT$85.61 bil­lion (US$2.70 bil­lion).

The mar­ket opened down 5.92 points and fell to the day’s low on fol­low-through selling from a ses­sion ear­lier, but with the in­dex fall­ing be­low 8,500 points, bar­gain hunt­ing emerged to largely fo­cus on the non-high tech sec­tor to push up the broader mar­ket back into pos­i­tive ter­ri­tory, deal­ers said. Strength re­mained un­til the close, they said.

Tech­ni­cal Sup­port at around

8,500 Points: An­a­lyst

“The lo­cal mar­ket had fallen sharply in re­cent months. It seemed that the in­dex has found some tech­ni­cal sup­port at around 8,500 points,” Mega In­ter­na­tional In­vest­ment Ser­vices Corp. an­a­lyst Alex Huang.

Since April 27, when the in­dex hit a 2015 high of 9,793.12 points, the mar­ket had shed al­most 1,300 points or about 13 per­cent as of Tues­day.

“So, in­vestors moved to funds in the non-high tech sec­tor to buy fi­nan­cial and old econ­omy stocks, while they tended to avoid elec­tron­ics stocks amid fears over weak mar­ket de­mand for the third quar­ter,” Huang said.

The fi­nan­cial sub-in­dex closed up 0.52 per­cent to serve as one of the pil­lars to main­tain the in­dex above the pre­vi­ous clos­ing level on ex­pec­ta­tions that many fi­nan­cial in­sti­tu­tions will bag fat cash div­i­dends in the third quar­ter from their eq­uity in­vest­ments, Huang said.

Gain­ing Fi­nan­cial Stocks

Among the gain­ing fi­nan­cial stocks, CTCB Fi­nan­cial Hold­ing Co. rose 2.13 per­cent to close at NT$23.95, and Fubon Fi­nan­cial Hold­ing Co. added 1.22 per­cent to end at NT$58.00, while Cathay Fi­nan­cial Hold­ing Co. closed down 0.39 per­cent at NT$50.60.

In the old econ­omy sec­tor, food maker Uni-Pres­i­dent En­ter­prises Corp. ( ) gained 1.60 per­cent to end at NT$57.00, and Formosa Plas­tics Corp. ( ) added 2.16 per­cent to close at NT$71.00.

“The elec­tron­ics sec­tor un­der­per­formed the broader mar­ket as in­vestor sen­ti­ment has been haunted by de­mand con­cerns,” Huang said. “That’s why Tai­wan Semi­con­duc­tor Man­u­fac­tur­ing Co. (TSMC,

) faced selling to­day.”

TSMC Fell 1.83%

TSMC, the most heav­ily weighted stock in the lo­cal mar­ket fell 1.83 per­cent to close at NT$134.00. Huang said that if TSMC shares fail to re­bound, the broader mar­ket is ex­pected to stay weak in the near fu­ture.

Also in the high-tech sec­tor, Lar­gan rose 1.68 per­cent to close at NT$3,020.00, and Catcher jumped 7.96 per­cent to end at NT$339.00 on bar­gain hunt­ing, while Hon Hai Pre­ci­sion In­dus­try Co. ( ) lost 0.56 per­cent to close at NT$89.00.

“To­day’s thin turnover showed that many in­vestors are re­luc­tant to chase prices for the mo­ment,” Huang said. “Fears over a rate hike by the U.S. Fed­eral Re­serve still kept in­vestors at bay.”

In a Wall Street Jour­nal re­port on Tues­day, At­lanta Fed Pres­i­dent Dennis Lock­hart said that U.S. econ­omy ap­pears ready for a rate hike in Septem­ber.

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