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Local bourse reverses early losses as China shares rebound

Local bourse reverses early losses as China shares rebound

Taipei, Dec. 5 (CNA) Shares on the Taiwan Stock Exchange recouped earlier losses to close in positive territory Wednesday as investors took cues from a strong rebound posted by the Shanghai and Shenzhen markets in China, dealers said. Old economy stocks, in particular the so-called "China concept" ones that have close business ties with China, were boosted by rotational buying, while the financial sector attracted interest on hopes of increasing cross-Taiwan Strait financial exchanges, they said. Select highly priced high tech stocks led by handheld device camera lens supplier Largan Precision Co. turned stronger to lend support to the broader market, they added. The weighted index closed up 48.07 points, or 0.63 percent, at 7,649.05, after moving between 7,567.46 and 7,650.12 on turnover of NT$101.23 billion (US$3.48 billion). The market opened down 0.33 percent and moved to the day's low as lackluster Wall Street performance overnight provided little incentive to investors here to buy after talks between the White House and the U.S. Congress on the pending "fiscal cliff" stalled, the dealers said. However, after witnessing markets in China post significant gains, investors resumed buying in late morning trade to push up the index above Tuesday's closing level, they said. "The significant gains posted by the Shanghai and Shenzhen markets gave investors here strong hints to buy into China concept stocks," Mega International Investment Service Corp. analyst Alex Huang said. Among the winning old economy stocks, retail chain operator Ruentex Industries rose 5.61 percent to close at NT$71.50, and contract footwear manufacturer Pou Chen gained 2.48 percent to end at NT$31.05. In the electronics sector, Largan Precision added 1.65 percent to close at NT$800.00 on hopes that the company will post an increase in sales for November on the back of large orders from Apple Inc. Meanwhile, smartphone vendor HTC gained 1.62 percent to end at NT$283.00, while Taiwan Semiconductor Manufacturing Co., the world's largest contract chip maker, closed up 0.31 percent at NT$96.90, off an early low of NT$94.60. "The turnover above the NT$100 billion mark means many investors have returned to the trading floor and have become more willing to buy by taking advantage of low valuations after the recent slump," Huang said. "But investors should keep a close eye on the negotiations in Washington to avoid the fiscal cliff. Those talks could continue to move the global financial markets," Huang said. The fiscal cliff refers to sizable tax increases and spending cuts that will kick in Jan. 1 if alternative deficit-cutting measures are not adopted, which could trigger a recession. The cement sector scored the highest gains among the eight major sectors of the market, finishing up 1.22 percent. Plastics and chemicals added 0.89 percent, financials rose 0.87 percent, foodstuffs gained 0.81 percent and the construction sector closed up 0.47 percent. The machinery and electronics, and paper and pulp sectors rose 0.43 percent, and textiles ended up 0.19 percent. Flat panel maker Chunghwa Picture Tubes rose 1.11 percent to close at NT$0.91 after rebounding from an earlier decline of 5.56 percent after the company said it has assigned provisions to cover damages sought by Hewlett-Packard, which has sued the Taiwanese firm for price-fixing. (By Frances Huang)


Updated : 2021-10-16 13:35 GMT+08:00