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Taiwan shares edge lower

Taiwan shares edge lower

Taipei, Dec. 2 (CNA) Shares in Taiwan closed slightly lower Wednesday as large cap stocks took a pause throughout the trading session after a rally seen a session earlier, dealers said.

Market sentiment turned cautious amid lingering fears over a possible interest rate hike by the U.S. Federal Reserve, while many investors preferred to take to the sidelines, simply watching how high-tech firms will report their sales data for November, they said.

The weighted index on the Taiwan Stock Exchange closed down 5.90 points, or 0.07 percent, at 8,457.40, after moving between 8,441.28 and 8,497.19, on turnover of NT$89.96 billion (US$2.75 billion).

The market opened up 0.15 percent and rose to the day's high on follow-through buying from a 1.71 percent increase seen Tuesday, but with the index moving closer to the nearest technical resistance at around 8,500 points, selling set in to drag down the index into the red and the weakness continued until the close, dealers said.

"After yesterday's strong showing, the weighted index has been coming closer to 8,500 points, where high technical hurdles existed," Mega International Investment Services Corp. analyst Alex Huang said.

"It was no surprise that many investors took a wait and see attitude for the moment amid fears that a major correction ahead of 8,500 points will cost them dearly."

Huang said that investor sentiment remained haunted by worries over a possible rate hike by the Fed. "Fed Chair Janet Yellen is scheduled to give speeches later in the week. Therefore, investors here tended to wait for more clues from the remarks to be made by the Fed head," Huang said.

Yellen will speak on the U.S. economic outlook at the Economic Club in Washington Wednesday and at the Joint Economic Committee on Capitol Hill Thursday. With the U.S. economy showing signs of rebounding, the market has increasingly anticipated that the Fed will raise interest rates in December. Although Wall Street posted gains overnight with the Dow Jones Industrial Average closing up 0.95 percent and the tech-heavy NASDAQ index ending up 0.93 percent, the local main board remained under water by the close, Huang said. The bellwether electronics sector closed up only 0.11 percent Wednesday after a 2.08 percent rise seen a session earlier.

Among the large-cap high-tech stocks, Taiwan Semiconductor Manufacturing Co., the most heavily weighted stock in the local market, closed unchanged at NT$142.50 after a 2.52 percent rally on Tuesday, while Hon Hai Precision Industry Co., the world's largest contract electronics maker, fell 0.35 percent to end at NT$85.70 after a 2.38 percent increase a session earlier. Also in the electronics sector, smartphone camera lens supplier Largan Precision Co. gained 0.38 percent to close at NT$2,610.00, while PC brand Asustek Computer Inc. lost 1.81 percent to end at NT$272.00.

In the financial sector, which closed down 0.47 percent, Mega Financial Holding Co. fell 1.33 percent to end at NT$22.25, and Fubon Financial Holding Co. lost 0.58 percent to close at NT$51.60.

"Many investors remained worried about the November sales data to be released by electronics firms (by Dec. 10). It is possible that their November sales will lag behind the previous month's since October could be the revenue peak for the year in the high-tech sector," Huang said. (By Frances Huang)

Updated : 2021-09-21 10:05 GMT+08:00