Alexa
  • Directory of Taiwan

Taiwan shares end below 8,200 points; Hon Hai resilient

Taiwan shares end below 8,200 points; Hon Hai resilient

Taipei, Dec. 11 (CNA) Shares in Taiwan took another beating Friday to end below the 8,200 point mark amid fears that foreign institutions will continue to move funds out of the local equity market after a recent heavy sell-off, dealers said.

Many investors appeared reluctant to keep their holdings and continued to dump stocks, in particular market heavyweights, amid rising political uncertainty as the presidential election approaches, they said.

However, Hon Hai Precision Industry Co., one of the most important large-cap stocks in Taiwan, bucked the downtrend in the broader market to move higher after the world's largest contract electronics maker a day earlier reported record high sales for November, they added.

The weighted index on the Taiwan Stock Exchange closed down 100.28 points, or 1.22 percent, at 8,115.89, after moving between 8,108.68 and 8,253.11, on turnover of NT$87.44 billion (US$2.67 billion).

The market opened up 1.16 points and rose to the day's high on a mild technical rebound as investors were encouraged by a higher Wall Street overnight to buy. The Dow Jones Industrial Average ended up 0.47 percent, breaking a three session losing streak.

But, with the index moving closer to 8,300 points, downward pressure set in, focusing on large-cap stocks almost across the board, and escalated to push down the index to close near the day's low amid fears of further foreign institutional selling, dealers said.

"After witnessing heavy selling by foreign institutional investors in the past few sessions, market sentiment has been badly hurt," Ta Ching Securities analyst Andy Hsu said. "Even though the U.S. market stabilized to some extent, local shares remained under pressure today."

Before Friday's plunge, the weighted index fell 2.82 percent in the previous three sessions after foreign institutional investors sold a net NT$32.22 billion worth of shares. Foreign institutional investors were believed to have cut their holdings in local shares and moved funds to U.S. dollar assets on expectations that the U.S. Federal Reserve will launch an interest rate hike cycle next week.

"Judging from today's selling in market heavyweights, I suspect that foreign institutional investors stood on the sell side again," Hsu said. According to the TWSE, foreign institutional investors recorded a net sell of NT$8.59 billion Friday.

The bellwether electronics sector closed down 1.24 percent with Taiwan Semiconductor Manufacturing Co., the most heavily weighted stock in the local market, losing 1.06 percent to end at NT$139.50 with 29.94 million shares changing hands.

Also in the high-tech sector, PC brand Acer Inc. shed 2.75 percent to close at NT$10.60, and smartphone vendor HTC Corp. lost 3.63 percent to end at NT$69.00.

Against the slump in the weighted index, Hon Hai, an assembler of iPhones and iPads for Apple Inc., gained 0.24 percent to close at NT$83.10 after the Taiwanese manufacturer reported Thursday that it posted NT$517.52 billion in consolidated sales for November, up 2.89 percent from October, to hit a record high on the back of the launch of the iPhone 6s and the iPhone 6s Plus. In the non-high tech sector, CTBC Financial Holding Co. fell 2.69 percent to close at NT$16.25, and Cathay Financial Holding Co. lost 2.42 percent to end at NT$42.25.

"Many investors have turned cautious about the market movement ahead of the upcoming presidential election (slated for Jan. 16)," Hsu said. "It is possible that the local main board will encounter further selling down the road." (By Frances Huang)


Updated : 2021-09-28 07:24 GMT+08:00