Taipei, Feb. 12 (CNA) Taiwan shares moved higher on a technical rebound in the mid-morning session Monday, led by large cap stocks, after Wall Street bounced back at the end of last week, dealers said.
The upturn on the local main board, however, was capped amid lingering concerns over further volatility on the U.S. market, while buying was limited as many investors preferred to stay on the sidelines ahead of the upcoming long Lunar New Year holiday, dealers said.
As of 10:35 a.m., the weighted index on the Taiwan Stock Exchange had risen 60.86 points, or 0.59 percent, to 10,432.61, coming off an early high of 10,469.37 points, on turnover of NT$49.62 billion (US$1.69 billion).
The local equity market opened higher and maintained its momentum, led by large cap stocks in the bellwether electronics sector, after the Dow Jones Industrial Average on Friday bounced back more than 300 points, dealers said.
However, as the weighted index moved closer to the nearest technical resistance of 10,500 points, some investors shifted to the sell side, reflecting worry about more volatility on Wall Street down the road, Hua Nan Securities analyst Henry Miao said.
"After the recent plunge on Wall Street, there have been no indications of when the U.S. market will stabilize, which is still bothering investors in the global financial markets," Miao said.
With U.S. economic growth remaining steady, the global financial market is worried about a rise in inflation, which would prompt the U.S. Federal Reserve to speed up its interest rate hike cycle, he said.
Among the gaining market heavyweights Friday, contract chipmaker Taiwan Semiconductor Manufacturing Co., the most heavily weighted stock on the local market, had climbed 1.51 percent to NT$236.00, with 14.98 million shares changing hands, as of 10:35 a.m.
Miao said the buying in TSMC reflected hopes that the chipmaker would issue NT$8 in cash dividend per share on its 2017 earnings, compared with NT$7 a year earlier.
MediaTek Inc., the largest integrated circuit designer in Taiwan, was up 1.77 percent at NT$288.00, while Largan Precision Co., a smartphone camera lens supplier to Apple Inc. had risen 2.66 percent to NT$3,670.
In the old economy sector, Formosa Plastics Corp. had gained 2.76 percent to reach NT$100.50, and Nan Ya Plastics Corp. was 0.60 percent higher at NT$76.50.
"It seems that some investors are reluctant to chase prices ahead of the Lunar New Year holiday in case negative leads emerge in the global market during the holiday," Miao said.
Monday is the last trading session on the local equity market ahead of the six-day Lunar New Year holiday, which starts Thursday.
Source: Focus Taiwan