Taipei, Shares in Taiwan closed slightly higher Monday after investors locked in their earlier gains amid lingering concerns over trade friction between the United States and China, dealers said.
While large-cap stocks remained largely sluggish, select electronic component stocks attracted buying to fend off profit taking after the main board breached the 10,700-point mark, where stiff competition remained, the dealers said.
The weighted index on the Taiwan Stock Exchange (TWSE), or Taiex, ended up 8.09 points, or 0.08 percent, at 10,699.05, after moving between 10,663.44 and 10,729.90, on turnover of NT$113.25 billion (US$3.68 billion).
The market opened up 7.80 points and rose to the day's high in reflection of a higher Wall Street, where the Dow Jones Industrial Average rose more than 100 points Friday on the back of a media report that U.S. President Donald Trump and Chinese President Xi Jinping hope to meet to discuss trade issues in November, the dealers said.
However, with the Taiex breaching the 10,700-point mark, some investors shifted to the sell side to take profits, which eroded most of the earlier gains and led the main board to score just a slight gain by the end of the session, they said.
"Investors remained cautious about the upcoming meeting between Trump and Xi, since there are big differences in trade issues between the two sides," Ta Ching Securities analyst Jerry Chen said.
"Since it will not be easy for Washington and Beijing to come to any agreement easily, investors preferred to take advantage of an earlier rebound in share prices and take profits for the moment," Chen said. "Such movement shows that market confidence remained fragile, placing the Taiex in consolidation mode."
Chen said that many market heavyweights witnessed their earlier upturn partially or totally erased by the end of the session at a time when caution dominated trading throughout the session.
Among the large-cap stocks, contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC), the most heavily weighted stock in the local market, closed unchanged at NT$239.50 after hitting a high of NT$240.00, with 16.94 million shares changing hands.
iPhone assembler Hon Hai Precision Industry Co., second to TSMC in terms of market value, fell 0.12 percent to end at NT$81.00, off an early high of NT$81.60, and PC brand Acer Inc. shed 2.70 percent to close at NT$23.45.
Outperforming the broader market, Largan Precision Co., a smartphone camera lens supplier to Apple Inc., gained 3.61 percent to end at NT$4,590.00. "However, the gains posted by Largan were just technical in nature and failed to give a real boost to the index," Chen said.
Firms rolling out passive electronic components such as chip resistors and multi-layer ceramic capacitors moved sharply higher, with Yageo Corp. up 5.08 percent to close at NT$662.00 and Walsin Technology Corp. up 6.70 percent to end at NT$278.50.
"I suspect that buying in these passive component stocks came from government-led funds, as the government did not want to see a weakening market," Chen said.
In the non-high tech sector, which closed mixed, food brand Uni-President Enterprises Corp. fell 2.08 percent to end at NT$75.40, and Formosa Chemicals and Fibre Corp., lost 0.42 percent to close at NT$117.50, while China Steel Corp., the largest steel maker in Taiwan, gained 1.22 percent to end at NT$24.95.
"Amid unfavorable external leads from global trade disputes, it is possible for the Taiex to move lower," Chen said.
"However, the government is expected to lend support to prevent heavy losses."
According to the TWSE, foreign institutional investors bought a net NT$3.77 billion-worth of shares on the main board Monday.
Source: Focus Taiwan News Channel