Shares in Taiwan moved higher Friday but eventually faced stiff technical resistance ahead of 15,000 points, dealers said.
The market was led by a rally by contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC), which finished at or above NT$500 (US$16.45) for the first time since Aug. 31, 2022 after saying a day earlier that it would outperform the global semiconductor industry in 2023.
The Taiex, the Taiwan Stock Exchange’s weighted index, ended up 92.49 points, or 0.63 percent, at 14,824.13, after moving between 14,822.15 and 14,962.31. Turnover totaled NT$181.97 billion.
The market opened up 1.3 percent as TSMC attracted strong buying due to its optimistic assessment for 2023 despite ongoing inventory adjustments in the global semiconductor industry.
Buying momentum continued but, as the Taiex closed in on technical hurdles ahead of 15,000 points, investors moved to the sell side, pulling the index down to close to the day’s low by the end of session, dealers said.
After its American depositary receipts (ADRs) soared 6.38 percent overnight, TSMC, the most heavily weighted stock in the local market, rose 2.77 percent to close at NT$500.00, off a high of NT$509.00.
Led by TSMC, the bellwether electronics sector gained 0.97 percent to end at 687.83, off a high of 697.76, and the semiconductor sub-index closed up 1.76 percent at 332.70, off a high of 338.58.
At an investor conference Thursday, TSMC CEO C.C. Wei (???) said the global semiconductor industry is expected to regain its footing in the second half of 2023 after seeing weakness in the first half.
He anticipated that TSMC will see a slight increase in sales in U.S. dollar terms in 2023, while the entire industry, excluding memory chip suppliers, and pure play foundries will likely see sales fall 4 percent and 3 percent, respectively, in 2023.
“Without TSMC, the Taiex would have fallen today,” Concord Capital Management analyst Lu Chin-wei (???) said, referring to the stock’s contribution of about 110 points in gains to the Taiex.
Even TSMC’s application-specific integrated circuit (ASIC) design subsidiary Global Unichip Corp. lost ground, shedding 2.85 percent to end at NT$682.00.
“In addition to technical factors ahead of 15,000 points, many investors preferred to lock in gains built in recent trading sessions before the market closes for the Lunar New Year holiday amid fears that external negative leads will emerge during the period,” Lu said.
“To many investors, it was a good opportunity to take profit as TSMC helped the Taiex gain more than 200 points early in the session,” he said.
The index of the over-the-counter (OTC) market lost 0.34 percent to close at 186.22, which Lu also saw as profit taking ahead of the long holiday.
The last trading day for stock markets in Taiwan will be Jan. 17, and trading will resume on Jan. 30.
Among other semiconductor heavyweights, smartphone IC designer MediaTek Inc. lost 2.94 percent to close at NT$694.00, and Powership Semiconductor Manufacturing Corp., a smaller contract chipmaker, fell 0.59 percent to end at NT$33.65.
IC packaging and testing services provider ASE Technology Holding Co. closed unchanged at NT$101.00, but United Microelectronics Corp., another contract chipmaker, rose 0.55 percent to end at NT$45.40 after its ADRs rose 1.75 percent overnight.
The optoelectronics industry fell 2.42 percent after Largan Precision Co., a supplier of smartphone camera lenses to Apple Inc., tumbled 7.28 percent to close at NT$2,005.00.
The company said at an investor conference Thursday that the global smartphone market was still struggling with high inventories amid weakening demand, and it expected sales to slow in January and February.
Largan’s slump was mirrored by rival Genius Electronic Optical Co.’s loss of 2.00 percent during the session to end at NT$342.50.
Lu said select raw material stocks in the cement and petrochemical industries got a boost from hopes that demand from China will pick up after easing COVID-19 controls.
In the cement industry, which rose 1.05 percent, Taiwan Cement Corp. gained 2.12 percent to close at NT$36.15, and Asia Cement Corp. added 0.48 percent to end at NT$42.15.
In the petrochemical industry, which grew 0.58 percent, Formosa Chemicals & Fibre Corp. gained 1.69 percent to close at NT$72.40, and Formosa Petrochemical Corp. rose 0.61 percent to end at NT$82.20.
The financial sector appeared mixed with Fubon Financial Holding Co. down 0.34 percent to close at NT$58.70, and Cathay Financial Holding Co. up 0.24 percent to end at NT$41.80.
“Because Washington reported cooling inflation overnight, the Fed may raise its key interest rates by only 25 basis points at the next two-day policymaking meeting that ends Feb. 1, which could boost global financial markets,” Lu said.
“That makes it likely the Taiex will move higher after the Lunar New Year holiday ends.”
According to the Taiwan Stock Exchange, foreign institutional investors bought a net NT$30.67 billion in shares on the market Friday.
Source: Focus Taiwan News Channel