Lo­cal shares edge up as fi­nan­cial stocks re­bound and TSMC gains

The China Post - - TAIWAN BUSINESS -

Shares in Tai­wan closed slightly higher Thurs­day, re­cov­er­ing from an early low to push the in­dex above the 8,000 point level, as the fi­nan­cial sec­tor staged a re­bound from its heavy losses in the pre­vi­ous ses­sion, deal­ers said.

Tai­wan Semi­con­duc­tor Man­u­fac­tur­ing Co. (TSMC, ), the most heav­ily weighted stock on the lo­cal mar­ket, and other in­te­grated cir­cuit stocks, at­tracted buy­ing from bar­gain hun­ters to post gains and lend sup­port to the broader mar­ket, deal­ers said.

The weighted in­dex on the Tai­wan Stock Ex­change closed up 7.97 points, or 0.09 per­cent, at 8,029.81, af­ter mov­ing be­tween 7,951.72 and 8,063.80. Turnover to­taled NT$87.98 bil­lion (US$2.71 bil­lion) dur­ing the ses­sion.

The mar­ket opened down 0.23 per­cent and fell be­low 8,000 points in the wake of the losses on Wall Street, where the Dow Jones In­dus­trial Av­er­age dropped 0.93 per­cent due to fall­ing in­ter­na­tional crude oil prices, deal­ers said.

The lo­cal mar­ket con­tin­ued to see­saw in the ses­sion as fi­nan­cial and IC stocks fended off down­ward pres­sure on old econ­omy stocks, help­ing the broader mar­ket re­turn to 8,000 points and fin­ish above the pre­vi­ous clos­ing level, deal­ers said.

“Judg­ing from the buy­ing in fi­nan­cial stocks and TSMC, I sus­pect that gov­ern­ment-led funds stood on the buy side in a bid to pre­vent the lo­cal in­dex from fall­ing fur­ther af­ter yesterday’s steep drop,” said Mega In­ter­na­tional In­vest­ment Ser­vices Corp. an­a­lyst Alex Huang.

On Wed­nes­day, the lo­cal main board fell 1.9 per­cent due to lin­ger­ing con­cerns over the eco­nomic cli­mate af­ter the gov­ern­ment cut its forecast for Tai­wan’s 2015 eco­nomic growth to 1.56 per­cent from 3.28 per­cent.

On Thurs­day, the fi­nan­cial sub-in­dex closed up 0.65 per­cent and the semi­con­duc­tor sec­tor 0.82 per­cent.

In the fi­nan­cial sec­tor, Fubon Fi­nan­cial Hold­ing Co. ( ) rose 2.59 per­cent to close at NT$51.40, and E. Sun Fi­nan­cial Hold­ing Co. ( ) gained 3.79 per­cent to end at NT$19.15.

Deal­ers said the re­cent heavy selling in the lo­cal fi­nan­cial sec­tor re­sulted in fears that a fall­ing Chi­nese yuan will drag down the value of lo­cal fi­nan­cial in­sti­tu­tions’ as­sets as they have plenty of ex­po­sure to China.

TSMC rose 0.80 per­cent to close at NT$126.00, and IC pack­ag­ing and test­ing ser­vice provider Ad­vanced Semi­con­duc­tor En­gi­neer­ing Inc. (ASE, ) added 1.29 per­cent to end at NT$31.50.

Un­der­per­form­ing the broader mar­ket, IC de­signer Me­di­aTek Inc. ( ) fell 0.38 per­cent to close at NT$260.00, off an early low of NT$254.00, as in­vestors were wor­ried that an es­ca­lat­ing prod­uct price com­pe­ti­tion in the China mar­ket will af­fect the com­pany’s profit mar­gin.

In the old econ­omy sec­tor, Formosa Plas­tics Corp. ( ) fell 2.50 per­cent to close at NT$66.30, and Nan Ya Plas­tics Corp. ( ) lost 2.00 per­cent to end at NT$58.80 due to the weak­ness of the global oil mar­ket.

The re­cent sell-off prompted some bar­gain hun­ters to re­turn to the trad­ing floor, Huang said, re­fer­ring to an al­most 2,000 point plunge since late April.

“But, as sen­ti­ment to­ward the lo­cal econ­omy re­mained weak, the lo­cal eq­uity mar­ket con­tin­ued to move in con­sol­i­da­tion mode,” he said. “Un­less the in­dex re­bounds sig­nif­i­cantly to above 8,230 points, the mar­ket will re­main tech­ni­cally weak and fur­ther volatil­ity is pos­si­ble.”


The Min­istry of Eco­nomic Af­fairs (MOEA, ) an­nounced Tai­wan’s fourth con­sec­u­tive month of drops in ex­port or­ders yesterday. Or­ders placed in July to­taled US$36.29 bil­lion, amount­ing to a 5.7-per­cent an­nual re­duc­tion rate.

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