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Taiwan shares end little changed as TSMC stabilizes broader market

Taiwan shares end little changed as TSMC stabilizes broader market

Taipei, July 17 (CNA) Shares in Taiwan closed flat Friday amid cautious sentiment during the ongoing earnings season as investors feared that the bellwether electronics sector will report disappointing results for the second quarter, dealers said. Taiwan Semiconductor Manufacturing Co. (TSMC, ???), the world's largest contract chip maker, staged a rebound to lend support to the broader market, as investors were impressed by the progress of the chip maker's efforts in developing the advanced 10 nanometer progress, the dealers said. With TSMC, the most heavily weighted stock in the local market, attracting a large chunk of funds, non-high tech stocks, including financial shares, remained slow throughout the session, they added. The weighted index on the Taiwan Stock Exchange ended up 3.77 points, or 0.04 percent, at 9,045.98, after moving between 9,018.10 and 9,079.23, on turnover of NT$75.80 billion (US$2.44 billion). The market opened up 0.30 percent and rose to the day's high as investors were encouraged by gains posted on Wall Street overnight on better-than-expected corporate earnings, the dealers said. But with the index moving closer to the 9,100-point mark, selling emerged, forcing the market to give up most of its earlier gains at the close, while TSMC remained resilient and kept the broader market from dipping into negative territory, the dealers added. "TSMC served as the anchor to stabilize the market today," KGI Securities analyst Phil Chu said. "The local bourse remained overshadowed by fears that the current earnings season will come up with negative leads." TSMC rose 2.56 percent to close at the day's high of NT$140.00 with 55.83 million shares changing hands after investors shrugged off the firm's lower-than-expected third-quarter sales guidance. "Investors were motivated by a rebound staged by TSMC's American depositary receipts on Wall Street overnight, despite the third-quarter sales forecast. Many investors took hints from the progress of TSMC's 10nm process and remained upbeat about its competitive edge," Chu said. TSMC is scheduled to launch commercial production of the 10nm process in the fourth quarter of 2016, and to begin shipping chips made on the technology in the first quarter of 2017 to compete with its chief rival, Intel Corp. Led by TSMC, the semiconductor sub-index closed up 1.10 percent, while the electronics sub-index ended up only 0.09 percent. "The figures told us that many investors preferred to keep away from high-tech stocks for the moment," Chu said. Among the falling electronics stocks, flat panel maker AU Optronics Corp. (??) shed 3.21 percent to close at NT$12.05, and integrated circuit designer MediaTek Inc. (???) lost 1.08 percent to end at NT$365.00. Smartphone lens supplier Largan Precision Co.(???) fell 2.70 percent to close at NT$3,425, although the firm reported a more- than 9 percent sequential sales increase in net profit for the second quarter. Chu said that Friday's selling showed that investors pocketed their gains posted a day earlier, despite optimism toward Largan's bottom line. "In addition to the local earnings season, investors should keep alert over the upcoming economic data in the United States, as the figures could affect the pace of the U.S. Federal Reserve's planned rate hikes," Chu said. Washington was scheduled to report consumer sentiment and consumer price data later in the day. (By Frances Huang)


Updated : 2021-09-23 22:49 GMT+08:00