Taiwan shares edge down to 8,442.29, but Largan rebounds
Shares in Taiwan closed slightly lower on Friday after bargain hunters stepped in to pick up stocks hit hard early in the session and a day earlier, minimizing the day’s losses, dealers said.
Largan Precision Co. ( ), a smartphone lens supplier to Apple Inc., staged a strong technical rebound after a 10 percent plunge on Thursday, and its gains led other “Apple concept stocks” to move higher, lending additional support to the broader market, they said.
Turnover remained thin as many investors were cautious ahead of the release of the U.S. July non-farm payroll report due out later in the day, wanting to get a feel for the state of the world’s largest economy before making more bets, they added.
The weighted index on the Tai- wan Stock Exchange closed down 7.27 points, or 0.08 percent, at 8,442.29, after moving between 8,368.40 and 8,458.04, on turnover of NT$75.44 billion (US$2.38 billion).
The market opened down 0.60 percent and quickly fell to the day’s low in the wake of the losses incurred on Wall Street overnight.
Bargain Hunting Emerged
But as the index appeared headed to 8,300 points, bargain hunting emerged, with a stronger Largan also triggering buying in select high-tech stocks in the Apple supply chain, dealers said.
“It seemed that some technical support existed ahead of 8,300 points after the market fell sharply yesterday,” KGI Securities analyst Phil Chu said. “It was good to see Largan shares bounce back, im- proving market sentiment to some extent.”
Largan, the most expensive stock in the local market, rose 7.90 percent to close at NT$2,935.00 after the company issued a disclaimer to rebut rumors that affected its share price on Thursday.
Rumor about Largan
Speculation that Largan had revealed to the media that its sales in August were relatively unchanged from July was circulated through LINE links on Thursday, sending the stock into a tailspin because it contradicted Largan’s guidance that sales in August would be higher than in July.
In its disclaimer, Largan said it did not talk to the media, and it urged investors to pay attention to the actual numbers.
The Financial Supervisory Com- mission, the top financial regulator in Taiwan, said it will investigate who spread the false negative leads.
Apple Suppliers Rebounded
Led by Largan, other Apple suppliers also rebounded, dealers said.
Among them, Pegatron Corp. ( ), an assembler of the iPhone 6, rose 3.23 percent to end at NT$83.10 after a 4.51 percent drop a day earlier, while Flexium Interconnect Inc., a printed circuit board supplier, gained 4.35 percent to close at NT$96.00 after a 7.54 percent fall the previous day.
Underperforming the broader market, Taiwan Semiconductor Manufacturing Co. (TSMC, ), the most heavily weighted stock in the local market, fell 0.75 percent to end at NT$133.00, although the stock recovered from a low of NT$131.50 on late-session buying.
In the non-high-tech sector, food maker Uni-President Enterprises Corp. ( ) fell 0.56 percent to end at NT$52.80, and Mega Financial Holding Co. ( ) shed 1.29 percent to close at NT$26.85.
“After yesterday’s 1.08 percent fall, the main board entered consolidation mode. I expect that the index will move between 8,300 points and 8,500 points in the near term,” Chu said.
Chu said the upcoming U.S. job data could serve as a barometer of the U.S. economy, which could move Wall Street and even global financial markets, leaving investors nervous about investing too much before the data was released.