Taiwan shares down nearly 1% despite Wall Street gains

Taipei-Shares in Taiwan moved lower to close below the 10,900-point mark Wednesday as investors ignored the rise in the Dow Jones Industrial Average overnight, dealers said.

Contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC), the most heavily weighted stock in the local market, led the broader market slide as investors reacted to losses posted by semiconductor stocks in the U.S. market, they said.

But select old economy stocks, in particular in the steel sector, and the financial sector bucked the broader market's downturn to keep the weighted index from falling further, dealers said.

The weighted index on the Taiwan Stock Exchange ended down 83.80 points, or 0.77 percent, at 10,831.09, after moving between 10,819.25 and 10,934.75, on turnover of NT$137.307 billion (US$4.62 billion).

The market opened up 0.43 points and rose to the day's high just minutes later, but selling soon emerged and accelerated the rest of the session as TSMC felt pressure from a 0.97 percent fall in the Philadelphia Semiconductor Index on Tuesday, dealers said.

Led by TSMC, the weighted index continued to move lower and ended below the 10,900-point level, though some buying momentum was seen in old economy and financial stocks, they said.

"It seemed that it has become a trend for buying to rotate to non-tech stocks, not only in Taiwan but also in the U.S. market for now, as the slow season for the electronics industry has arrived," Concord Securities analyst Kerry Huang said.

"In Taiwan, many investors simply rushed to pocket their gains in the bellwether electronics sector, and TSMC was the victim of the profit-taking," Huang said.

TSMC, the world's largest contract chipmaker, fell 2.27 percent to close at NT$236.50, with 23.60 million shares changing hands. The electronics sector dropped 1.42 percent as a whole and the semiconductor sub-index shed 1.91 percent.

Selling in TSMC spread to Hon Hai Precision Industry Co., second to TSMC in terms of market value, which dropped 1.09 percent to end at NT$90.80.

Outperforming the broader market, integrated circuit designer MediaTek Inc. gained 1.81 percent to close at NT$309.50 after the company achieved its sales goal for the fourth quarter of last year.

In the wake of rotational buying, the steel sector rose 0.99 percent, with Tung Ho Steel Enterprise Corp. up 3.21 percent to close at NT$27.35, and Yieh Hsing Enterprise Co. up 6.24 percent to end at NT$5.62.

The financial sector also rose 0.47 percent. Fubon Financial Holding Co. rose 0.95 percent to close at NT$53.00, and Mega Financial Holding Co. gained 1.40 percent to end at NT$25.35.

"Despite the fall in the index, turnover for today still stayed around NT$130 billion, similar to that in recent sessions, indicating that there was no panic selling," Huang said.

"But sentiment toward the electronics sector is expected to remain cautious ahead of an investor conference scheduled by smartphone camera lens maker Largan Precision Co. after the market closes Thursday," Huang said.

Largan, a supplier to Apple Inc., which had moved sharply lower amid concerns over shipments of the premium iPhone X, rose 0.80 percent Wednesday to close at NT$3,775.00 on a mild technical rebound.

According to the TWSE, foreign institutional investors sold a net NT$1.12 billion in shares on the market Wednesday.

Source: Focus Taiwan News Channel