Taiwan shares end below 9,300 point mark

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Shares in Taiwan moved lower to close below the 9,300-point mark Thursday, as the bellwether electronics sector encountered relatively heavier downward pressure in the wake of losses incurred on the tech-heavy NASDAQ index in the U.S. market overnight, dealers said.

Among the falling electronics stocks on the main board, suppliers to Apple Inc. led the downturn as investors took cues from a plunge in Apple shares overnight on its disappointing results, while old economy stocks also faced selling due to investors locking in their earlier gains, the dealers said.

Market sentiment remained cautious during the ongoing earnings season amid lingering fears that local export-oriented high-tech firms will report foreign exchange losses for the third quarter due to a stronger Taiwan dollar, they said.

The weighted index on the Taiwan Stock Exchange closed down 62.70 points, or 0.67 percent, at 9,299.55, after moving between 9,286.86 and 9,370.32, on turnover of NT$66.45 billion (US$2.10 billion).

The market opened up 1.65 points and rose slightly to the day's high before selling set in during the mid-morning session, with Apple concept stocks in focus after Apple shares fell 2.25 percent overnight to push down the NASDAQ index by 0.63 percent as investors were disappointed with the U.S. consumer giant's results for the July-September period, the dealers said.

Downward pressure on the local main board continued as electronics heavyweights stocks, such as contract chip maker Taiwan Semiconductor Manufacturing Co. (TSMC, 台積電) and smartphone camera lens supplier Largan Precision Co. (大立光), weakened, they said.

Selling also spread to old economy stocks, including petrochemical stocks, due to a pullback in international crude oil prices, the dealers added.

"During the ongoing earnings season, any lead has become sensitive to the market," Mega International Investment Services Corp. analyst Alex Huang said. "Investors here simply seized Apple's results as an excuse to take profits."

TSMC, the most heavily weighted stock in the local equity market, which is believed to serve as the sole supplier of the A10 processor for Apple's latest iPhones, fell 1.57 percent to close at the day's low of NT$188.50, with 26.18 million shares changing hands.

Largan, a smartphone camera lens supplier to Apple, also ended at the day's low of NT$3,715.00, down 1.72 percent, while Hon Hai Precision Industry Co. (鴻海), an assembler of iPhones and iPads, appeared resilient, down only 0.23 percent to close at NT$85.40.

Investors also pocketed their gains in other electronics stocks, in particular in the flat panel segment, Huang said. AU Optronics Corp. (友達) shed 1.91 percent to end at NT$12.85, and rival Innolux Corp. (群創) fell 1.78 percent to close at the day's low of NT$11.05.

In the non-high-tech sector, Formosa Chemicals & Fibre Corp. (台化) shed 1.38 percent to end at NT$93.20, and Eclat Textile Co. (儒鴻) lost 4.00 percent to close at NT$360.00, while Fubon Financial Holding Co. (富邦金) bucked the downtrend on the broader market, up 0.22 percent to end at NT$45.45.

"Judging from the thin turnover, I think investors here remained nervous about the current earnings season," Huang said. "A rising Taiwan dollar in the third quarter could affect the profitability of many electronics firms, in particular small and medium-sized ones."

Meanwhile, under the spotlight, shares of Taiwan High Speed Rail Corp. (THSRC, 台灣高鐵) soared 58.75 percent to close at NT$24.05 on the first session of their listing on the main board.

(By Frances Huang)
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