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Taiwan bourse rises on strength of tech stocks

Taiwan bourse rises on strength of tech stocks

Taiwan shares rose slightly yesterday on the strength of big-name tech shares.
The Weighted Price Index of the Taiwan Stock Exchange rose 9.24 points, or 0.1 percent, to close at 8,727.55 points on weak volume.
"It's obvious retail investors are not in the market and foreign investors are buying only select names," said Derek Lam of Fubon Securities. It would take at least one more month of consolidation until retail investors would come back, he said.
He tipped shares to trade in the 8,600-8,750 band today.
Weak undertone in overseas markets prompted investors to take a cautious stance, although there was bargain-hunting in select stocks that saw significant correction recently, said Alex Huang of Mega International Investment Services Co.
"Expectations of an upswing in steel prices on the global front boosted stocks in that segment, while some electronics (firms) attracted interest thanks to their earnings results for the first half," Huang said.
In yesterday's trading, Hon Hai Precision Industry ended up 1.9 percent to close at NT$245. Monday was the ex-dividend date, meaning that anyone buying shares Monday or afterward would not get this year's dividend.
Asustek went up 3.6 percent to NT$92.20 after it announced strong second quarter results. The gain also came after analysts recommended that investors switch to Asustek from Acer after the Acer's announcement it would buy U.S.-based computer vendor Gateway.
Acer slumped 6.9 percent to NT$59.20, on analysts' views that the company was paying too much for Gateway.
Macquarie Securities Ltd. reduced its recommendation for Acer to "neutral" from "outperform," and cut the stock's share-price target to NT$63.50 from NT$80.70. Acer is "wasting its cash bullets" in its takeover of Gateway, Daniel Chang, an analyst at Macquarie wrote in a report yesterday.
"Investors are not comfortable about the price Acer will pay for Gateway," said Vickie Hsieh, a manager at President Investment Trust Corp. in Taipei. "People disagreeing with the number will sell."
Cathay Financial Holding Co., the island's biggest life insurer, declined NT$1.90, or 2.5 percent, to NT$72.90. JPMorgan Chase & Co. said investors should avoid buying Taiwanese insurance stocks on concerns their earnings may be hurt by losses on U.S. subprime mortgage investments.
Investors should steer clear of Cathay Financial and Shin Kong Financial Holding Co., Sunil Garg, a Hong Kong-based analyst at JPMorgan said in a report dated Monday. They appear to be among the most at risk and we see no merit in owning these stocks, he said. Shin Kong, owner of the No. 3 life insurer in Taiwan, dropped NT$0.40, or 1.3 percent, to NT$31.10.


Updated : 2021-06-14 13:26 GMT+08:00