Taiwan shares end up as electronics, financials rebound

Shares in Taiwan closed above the 9,100 point mark Thursday as the electronics and financial sectors rebounded from the recent sessions, dealers said.

However, turnover remained thin with many investors taking to the sidelines, waiting for more clues about the U.S. Federal Reserve's monetary policy ahead of a speech by Fed Chair Janet Yellen at the upcoming annual central bankers' meeting, dealers said.

The weighted index on the Taiwan Stock Exchange ended up 98.09 points, or 1.09 percent, at the day's high of 9,115.47, off an early low of 9,031.34. Turnover totaled NT$76.17 billion (US$2.40 billion) during the session.

The market opened up 0.19 percent on a technical rebound as investors shrugged off a decline on Wall Street, where the Dow Jones Industrial Average fell 0.35 percent and the S&P 500 index lost 0.52 percent overnight, dealers said.

The momentum in the local equity market accelerated, with buying focusing on the bellwether electronics and financial sectors, as bargain hunters returned to the trading floor, picking up large-cap stocks such as Taiwan Semiconductor Manufacturing Co. (TSMC, ???) and Hon Hai Precision Industry Co. (??) and select financial stocks, dealers said.

The buying continued until the end of the session, vaulting the index past the 9,100 point level, they added.

"Thanks to the gains posted by electronics and financial heavyweights, the local main board moved higher," Concord Securities analyst Kerry Huang said. "But turnover was small, indicating that many investors remained reluctant to chase prices."

The electronics sub-index closed up 1.38 percent and the financial sector ended 1.58 percent higher.

Among the gaining high-tech heavyweights, contract chip maker TSMC, the most heavily weighted stock on the local market, rose 2.02 percent to close at NT$177.00 with 23.86 million shares changing hands.

Buying in TSMC shares appeared more visible late in the session and the stock closed at the day's high. Led by TSMC, the semiconductor sub-index ended up 1.78 percent.

Hon Hai, an assembler of iPhones and iPads for Apple Inc., gained 2.08 percent to end at NT$88.50 on trading volume of 56.48 million shares.

"The interest in Hon Hai was based largely on expectations that the launch of the next generation iPhones will boost the company's shipments in the second half of the year," Huang said.

Also in the high-tech sector, integrated circuit packaging and testing services provider Advanced Semiconductor Engineering Inc. (???) climbed 1.45 percent to close at NT$38.60, while Largan Precision Co. (???), a smartphone camera lens supplier to Apple, fell 1.38 percent to end at NT$3,585.00 but remained the most expensive stock on the local market.

In the financial sector, CTBC Financial Holding Co. (???) rose 3.87 percent to close at NT$18.80, and Cathay Financial Holding Co. (???) added 2.51 percent to end at NT$38.75 amid reports of a merger.

According to the reports, such a merger would produce the largest financial holding firm in Taiwan, with CTBC Financial handling banking operations, and Cathay Financial managing insurance business.

"Despite the gains, market sentiment remained cautious ahead of Yellen's speech," Huang said. "Investors at home and abroad are worried that she would hint at a rate hike, which would send ripples through the global financial markets."

He said it remains to be seen whether the index will hold above 9,100 points down the road.

Source: Focus Taiwan