Taipei, Shares in Taiwan closed lower Tuesday, as selling focused on Taiwanese suppliers to Apple Inc., after smartphone camera lens maker Largan Precision Co. reported disappointing sales for October, dealers said.
While the bellwether electronics sector led the broader market lower, select old economy and financial stocks appeared resilient, helping to keep the market above the 9,800-point mark by the end of the session, dealers said.
Market sentiment here has turned cautious ahead of the United States mid-term elections and amid uncertainty in the global financial markets, dealers said.
The weighted index on the Taiwan Stock Exchange (Taiex) ended down 64.86 points, or 0.66 percent, at 9,824.95, after moving between 9,782.86 and 9,899.97. Turnover totaled NT$116.88 billion (US$3.79 billion) during the session.
The market opened down 1.40 points and moved in ranged trade in the early morning session, but selling escalated around 10:30 a.m. with prominent Apple suppliers in focus, led by Largan, as investors were disappointed with its October sales, dealers said.
As the Taiex fell below the 9,800-point mark, some investors shifted to the buy side to pick up bargains, which helped the broader market recoup some of its earlier losses and return to that level by the end of the session, dealers said.
"Just like yesterday, bargain hunting emerged after the main board dropped below 9,800 points," which was closer to the five-day moving average and the nearest technical support, Mega Securities analyst Alex Huang said.
Bargain hunting featured non-tech stocks, with Formosa Plastics Corp. closing flat at NT$103.00 after hitting a low of NT$100.00, and China Steel Corp., the largest steel maker in Taiwan, ending unchanged at NT$24.35 after dropping to a low of NT$24.10.
In the financial sector, which closed up 0.20 percent, E. Sun Financial Holding Co. gained 0.24 percent to end at NT$20.95, and Fubon Financial Holding Co. rose 1.22 percent to close at NT$49.80.
After the selling throughout the session, the bellwether electronics sector closed down 1.08 percent as investors dumped "Apple concept stocks," taking into account a 6 percent monthly drop in Largan's sales in October despite the release of new iPhones in September.
Largan shares fell 6.26 percent to close at NT$3,220.00, with 1.18 million shares changing hands.
"Largan sales numbers indicated weaker-than-expected global demand for the latest iPhones," Huang said. "The sales figures caused downbeat sentiment among investors about the outlook for Apple and its suppliers."
Selling also spread to other Apple concept stocks, among them metal casing maker Catcher Technology Co., which shed 7.93 percent to end at NT$267.00, and iPhone assembler Hon Hai Precision Industry Co., which dropped 3.28 percent to close at NT$77.30.
Contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC), which supplies iPhone processors, finished 0.21 percent lower at NT$234.50 on late bargain hunting after hitting a low of NT$232.50.
"The impact of slower iPhone sales was less on TSMC because it has a diversified product line that includes automotive electronics and artificial intelligence," Huang said.
During the session, Huang said, many investors remained on the sidelines ahead of the U.S. mid-term elections, which were scheduled for later in the day.
"Taipei was not the only market with a cautious outlook because of the U.S. elections," Huang said. "Other major regional markets were moving in a narrow range because of a similar mood."
According to Taiex data, foreign institutional investors sold a net NT$4.43 billion worth of shares on the main board Tuesday.
Source: Focus Taiwan News Channel