Shares in Taiwan closed up slightly Tuesday after coming off an earlier high as concerns over increased fund outflows and a hawkish U.S. Federal Reserve continued to affect market sentiment.
The Taiex, the Taiwan Stock Exchange’s (TWSE) weighted index, ended up 16,10 points, or 0.11 percent at 14,677.20, after moving between 14,623.22 and 14,789.31, with turnover totaling NT$182.06 billion (US$5.92 billion).
The market opened up 0.30 percent and quickly breached the five-day moving average of 14,778 points before leveling off as investors sought to lock in their gains.
“The Taiex failed to stand well above the five-day moving average, indicating that the main board remained fragile technically,” Hua Nan Securities analyst Kevin Su said.
“When the market staged a rebound, investors sought to cash out, fearing the Fed’s continued aggressive approach on rate hikes will exacerbate fund outflows,” Su added.
Russian state-owned energy supplier Gazprom’s suspension of the Nord Stream 1 gas pipeline’s planned reopening caused an overnight plunge on the European markets, and Su said the effect of rising energy prices on inflation had continued to dictate local market sentiment.
“Investors should pay close attention to a policymaking meeting of the European Central Bank (ECB) set for Thursday to see how the ECB raises interest rates to take on inflation amid rising energy prices ahead of a Fed meeting later this month,” Su said.
The electronics sector saw its earlier gains almost eroded, up only 0.06 percent at the end of the session, with the semiconductor sub-index up 0.27 percent.
Contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC), the local market’s most heavily weighted stock, rose 0.62 percent to close at NT$489.00 off a high of NT$491.50.
However, Su cautioned that the stock still faced high technical hurdles ahead of NT$500.00.
Among other semiconductor stocks, TSMC’s application-specific integrated circuit design subsidiary Global Unichip Corp. gained 2.10 percent to end at NT$535.00, and United Microelectronics Corp. added 0.38 percent to close at NT$39.95.
Display driver IC design subsidiary Novatek Microelectronics Corp. fell 0.40 percent to end at NT$251.50.
“Fortunately, TSMC stayed resilient to keep the tech sector from falling to negative territory,” Su said. “Judging from TSMC’s movement, I suspect government-led funds stood on the buy side in a bid to shore up investor confidence.”
Also in the electronics sector, iPhone assembler Hon Hai Precision Industry Co. ended up 0.46 percent at NT$108.50, while Apple supplier Largan Precision Co., buoyed by the impending release of the iPhone 14 later this week, gained 0.26 percent to close at NT$1,930.00.
In the financial sector, which rose 0.60 percent, Fubon Financial Holding Co. added 0.53 percent to close at NT$56.90, Taishin Financial Holding Co. rose 1.00 percent to end at NT$15.20, Hua Nan Financial Holding Co. gained 1.09 percent to close at NT$23.20, and Yuanta Financial Holding Co. soared 2.71 percent to end at NT$20.85.
“Buying from the government-led funds was also seen in the financial sector, one of these funds’ favorites, to lend additional support to the broader market,” Su said.
A recent upturn in the biotech sector was reversed as the segment ended down 4.56 percent, with test kit supplier Panion & BF Biotech Inc. down 10 percent — the maximum daily decline — at NT$136.00, and medical equipment brand Maxigen Biotech Inc. down 8.98 percent at NT$44.60.
In the old economy sector, Evergreen Marine Corp., the largest container cargo shipper in Taiwan, rose 1.00 percent to close at NT$80.80, with rivals Wan Hai Lines Ltd. adding 0.79 percent to end at NT$76.80, and Yang Ming Transport Corp. dipping 0.28 percent to close at NT$70.60.
The tourism sector ended up 0.25 percent in the wake of Monday’s announcement that would resume visa-free entry privileges from Sept. 12 for travelers from the United States, Canada, Europe, Australia, New Zealand and Taiwan’s 14 diplomatic allies.
FarGlory Hotel Co. gained 1.21 percent to close at NT$33.40, and Lion Travel Service Co. gained 1.10 percent to end at NT$91.80.
According to the TWSE, foreign institutional investors bought a net NT$66 million worth of shares on the main board Tuesday.
Source: Focus Taiwan News Channel