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TSMC shares extend losses amid growth concerns

TSMC shares extend losses amid growth concerns

Taipei, March 27 (CNA) Shares of Taiwan Semiconductor Manufacturing Co. (TSMC, ???), the world's largest contract chip maker, continued to fall Friday morning, extending their losses from the previous session, amid lingering worries over slow growth in the global wafer foundry industry, dealers said. The Friday morning selling also reflected fears that foreign institutional investors may continue to cut their holdings in TSMC after a massive net sell the previous day, dealers said. TSMC's losses served to weaken the broader local semiconductor sector, they said, noting that the stock plunged 3.54 percent on Thursday. As of 11:09 a.m. Friday, shares of TSMC, the most heavily weighted stock on the local market, had fallen 1.37 percent to NT$143.50 (US$4.58) with 53.67 million shares changing hands. The weak sentiment toward TSMC also spread to other semiconductor stocks. Shares of Advanced Semiconductor Engineering Inc. (???) and Siliconware Precision Industries Co. (??), two leading integrated circuit packaging and testing services providers, had dropped 3.44 percent and 1.72 percent, respectively, to NT$42.05 and NT$51.40. The semiconductor sub-index was down 1.46 percent at 122.85 points, while the weighted index on the Taiwan Stock Exchange was down 0.81 percent at 9540.79. "TSMC has been overshadowed by growth concerns and worry that its major clients are facing rising inventories as a result of a stronger U.S. dollar," said KGI Securities analyst Phil Chu. "There are worries that the global wafer foundry business will grow at a slower pace than TSMC had anticipated," Chu said, referring to the chip maker's 12 percent sales increase forecast for 2015. In addition, Chu said, there have been signs that the growth of smartphone sales in China is slowing in the first half of the year, which has dealt another blow to the IC business. On Thursday, foreign institutional investors sold a net 67.85 million TSMC shares, accounting 43.16 percent of the trading volume of the stock, according to the TWSE. "Foreign institutional investors are likely to remain on the sell side today," Chu said. "It's no surprise that retail investors are following suit, lowering their holdings to lock in their recent gains." The market is anticipating that TSMC will post more than NT$11 in earnings per share for 2015, compared with NT$10.18 in 2014 but Chu said that forecast may be downgraded. "Amid such downbeat sentiment, TSMC shares are likely to move even lower and the nearest technical support is expected around NT$139- NT$140," Chu said. He said that with the instability of TSMC shares, the local bourse remained weak. In addition to the electronics sector, the financial sector also encountered downward pressure in Friday morning trade. Among the falling financial stocks, Fubon Financial Holding Co. (???) had dropped 2.10 percent to NT$56.00 as of 11:09 a.m. (By Frances Huang)


Updated : 2021-09-23 08:01 GMT+08:00