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Taiwan shares edge up as financial stocks rebound, TSMC gains

Taiwan shares edge up as financial stocks rebound, TSMC gains

Taipei, Aug. 20 (CNA) Shares in Taiwan closed slightly higher Thursday, recovering from an early low to push the index above the 8,000 point level, as the financial sector staged a rebound from its heavy losses in the previous session, dealers said.
Taiwan Semiconductor Manufacturing Co. (TSMC), the most heavily weighted stock on the local market, and other integrated circuit stocks, attracted buying from bargain hunters to post gains and lend support to the broader market, dealers said.
The weighted index on the Taiwan Stock Exchange closed up 7.97 points, or 0.09 percent, at 8,029.81, after moving between 7,951.72 and 8,063.80. Turnover totaled NT$87.98 billion (US$2.71 billion) during the session.
The market opened down 0.23 percent and fell below 8,000 points in the wake of the losses on Wall Street, where the Dow Jones Industrial Average dropped 0.93 percent due to falling international crude oil prices, dealers said.
The local market continued to seesaw in the session as financial and IC stocks fended off downward pressure on old economy stocks, helping the broader market return to 8,000 points and finish above the previous closing level, dealers said.
"Judging from the buying in financial stocks and TSMC, I suspect that government-led funds stood on the buy side in a bid to prevent the local index from falling further after yesterday's steep drop," said Mega International Investment Services Corp. analyst Alex Huang.
On Wednesday, the local main board fell 1.9 percent due to lingering concerns over the economic climate after the government cut its forecast for Taiwan's 2015 economic growth to 1.56 percent from 3.28 percent.
On Thursday, the financial sub-index closed up 0.65 percent and the semiconductor sector 0.82 percent.
In the financial sector, Fubon Financial Holding Co. rose 2.59 percent to close at NT$51.40, and E. Sun Financial Holding Co. gained 3.79 percent to end at NT$19.15.
Dealers said the recent heavy selling in the local financial sector resulted in fears that a falling Chinese yuan will drag down the value of local financial institutions' assets as they have plenty of exposure to China.
TSMC rose 0.80 percent to close at NT$126.00, and IC packaging and testing service provider Advanced Semiconductor Engineering Inc. (ASE) added 1.29 percent to end at NT$31.50.
Underperforming the broader market, IC designer MediaTek Inc. fell 0.38 percent to close at NT$260.00, off an early low of NT$254.00, as investors were worried that an escalating product price competition in the China market will affect the company's profit margin.
In the old economy sector, Formosa Plastics Corp. fell 2.50 percent to close at NT$66.30, and Nan Ya Plastics Corp. lost 2.00 percent to end at NT$58.80 due to the weakness of the global oil market.
The recent sell-off prompted some bargain hunters to return to the trading floor, Huang said, referring to an almost 2,000 point plunge since late April.
"But, as sentiment toward the local economy remained weak, the local equity market continued to move in consolidation mode," he said. "Unless the index rebounds significantly to above 8,230 points, the market will remain technically weak and further volatility is possible." (By Frances Huang)


Updated : 2021-09-21 16:42 GMT+08:00