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Taiwan shares rebound, led by financial, electronics stocks

Taiwan shares rebound, led by financial, electronics stocks

Taipei, July 30 (CNA) Shares in Taiwan staged a technical rebound Thursday from recent losses, as bargain hunters turned active to pick up heavyweight stocks in both the financial and electronics sectors, dealers said.
Sentiment improved to some extent as investors took cues from a statement released by the U.S. Federal Reserve issued overnight that it will keep its interest rates unchanged, they said. The Fed move gave a boost to Wall Street after the U.S. central bank concluded a two-day policymaking meeting.
The weighted index on the Taiwan Stock Exchange closed up 88.01 points, or 1.02 percent, at 8,651.49, after moving between 8,567.23 and 8,697.18, on turnover of NT$87.44 billion (US$2.78 billion).
The market opened up 6.42 points and momentum accelerated, with buying focusing on large-cap stocks in both the electronics and financial sectors, the dealers said.
Among the gaining stocks, United Microelectronics Corp. (UMC) moved sharply higher soon after the local bourse opened after the second-largest contract chip maker in Taiwan announced a share buyback program a day earlier. UMC's strength continued into the end of the session.
With the weighted index moving closer to the 8,700-point mark, some investors shifted to the sell side, compromising the upturn to some extent by the close, the dealers said.
"The local equity market has been oversold and many large-cap stocks in both the electronics and non-high-tech sectors appeared attractive in terms of valuations," Marbo Securities Investment Consulting analyst Chang Chih-cheng said.
After the weighted index closed at a 2015 high of 9,973.12 on April 27, the local main board had lost more than 1,300 points, or about 13 percent, as of Wednesday.
"Led by the gains posted by Wall Street overnight after the Fed left interest rates unchanged, the local bourse bounced back today," Chang said. "But as turnover failed to expand significantly, the index failed to surmount the nearest technical resistance level ahead of 8,700 points," he added.
UMC gained 5.58 percent to close at NT$11.35 with 82.35 million shares changing hands after the company launched a program to buy back up to 200 million shares at a price range between NT$7.55 and NT$18.8 during the July 30-Sept. 29 period to prop up its falling share price.
"UMC could see high technical hurdles at around NT$12.10 since investors remained wary of anticipated weak demand in the global semiconductor industry for the second half of this year," Chang said.
Buying also spread to other high-tech heavyweights, but their gains were only technical due to lingering worries about the market outlook, Chang said.
Among the gaining electronics stocks, Taiwan Semiconductor Manufacturing Co., the most heavily weighted stock in the local market, added 2.21 percent to end at NT$138.50, while PC brand Asustek Computer Inc. rose 5.07 percent to close at NT$290.00.
Underperforming the broader market, Hon Hai Precision Industry Co., an assembler of iPhones and iPads, fell 0.66 percent to end at NT$90.90. In the financial sector, which closed up 1.81 percent, Fubon Financial Holding Co. rose 3.62 percent to close at NT$57.30, and Mega Financial Holding Co. added 2.49 percent to end at NT$26.75.
"I suspect that buying in financial stocks largely came from foreign institutional investors. As such buying was just a beginning after recent sell-offs, it is likely that the sector will trend up further," Chang said. (By Frances Huang)


Updated : 2021-09-28 01:34 GMT+08:00