Shares in Taiwan moved lower Thursday as investors here took cues from a drop on Wall Street to cut their holdings in local equities but the weighted index managed to close above the 9,000 point mark, dealers said.
While most large-cap stocks across the board, in particular in the financial sector, came under downward pressure, smartphone camera lens supplier Largan Precision Co. (???) attracted buying, helping to prop up the broader market, dealers said.
Sentiment was cautious ahead of the release of the August jobs data in Washington on Friday, dealers said.
The weighted index on the Taiwan Stock Exchange closed down 67.70 points, or 0.75 percent, at 9,001.15, after moving between 8,980.21 and 9,069.13. Turnover totaled NT$79.14 billion (US$2.50 billion) during the session.
The market opened down 0.14 percent in a knee-jerk reaction to the weakness on Wall Street, where the Dow Jones Industrial Average closed down 0.29 percent and the S and P 500 index ended 0.24 percent lower in reflection of a fall in international crude oil prices Wednesday, dealers said.
Selling on the local main board continued to push the index lower, to below 9,000 points, with a focus on market heavyweights such as contract chip maker Taiwan Semiconductor Manufacturing Co. (TSMC, ???).
However, bargain hunters later became active, picking up Largan shares, the most expensive on the market, which helped the index rebound to 9,000 points by the close, dealers said.
"The drop in crude oil prices made many investors nervous about market demand at a time when the global economy is slowing down," Concord Securities analyst Kerry Huang said. "The local main board simply followed the lead of Wall Street and moved lower today." International crude oil prices fell about 3 percent overnight on higher than expected inventories.
"The weighted index ended above 9,000 points after coming off a low, indicating that the market technically has not weakened," Huang said.
"The resilience largely reflected the strength of optoelectronics stocks, in particular Largan." The optoelectronics sub-index closed up 1.33 percent after Largan, a supplier to Apple Inc., gained 4.07 percent to close at NT$3,705.00 on the back of a target price upgrade by a U.S.-based brokerage.
However, the bellwether electronics sector ended down 0.61 percent after TSMC, the most heavily weighted stock in Taiwan, fell 1.42 percent to end at NT$173.50 with 22.69 million shares changing hands.
Also in the high-tech sector, Hon Hai Precision Industry Co. (??), an assembler of iPhones and iPads, lost 0.68 percent to close at NT$87.40, and Catcher Technology Co., a metal casing supplier to Apple, fell 0.88 percent to end at NT$226.00.
"The financial sector faced relatively heavy downward pressure today as investors rushed to lock in the gains they had built in recent sessions," Huang said.
The financial sub-index closed down 1.01 percent, with Cathay Financial Holding Co. (???) shedding 1.87 percent to finish at NT$39.35, and Mega Financial Holding Co. (???), which is under a money laundering investigation, losing 1.62 percent to end at NT$21.25.
In the old economy sector, Taiwan Cement Corp. (??) fell 2.76 percent to close at NT$35.25, and food maker Uni-President Enterprises Corp. (??) dropped 2.83 percent to end at NT$35.25.
"The low turnover reflected caution over the upcoming jobs data in Washington, which is expected to serve as an important indication of whether the U.S. Federal Reserve will raise interest rates in the near future," Huang said.
The Fed is scheduled to hold a policymaking meeting Sept. 20-21.
Source: Focus Taiwan News Channel