Taipei, Shares in Taiwan closed slightly higher Friday after the main board recovered its earlier losses on bargain hunting, pushing the weighted index back into positive territory and helping the market remain above the 11,000 point mark at the end of the session, dealers said.
Contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC), the most heavily weighted stock on the local market, was the favorite of bargain hunters during the session, while buying in other select large cap stocks also helped the broader market close above its previous closing level, they said.
The weighted index on the Taiwan Stock Exchange or the Taiex ended up 9.25 points, or 0.08 percent, at 11,027.70, after moving between 10,933.46 and 11,054.86, on turnover of NT$165.97 billion (US$5.68 billion).
The market opened down 8.21 points on follow-through selling from the previous session and downward pressure escalated with market heavyweights in the bellwether electronics in focus as local investors were motivated by the 0.2 percent losses incurred by the tech-heavy NASDAQ index overnight, dealers said.
The weakness on the local main board continued until around 1 p.m., when bargain hunters turned active and began picking up TSMC shares, which had been under pressure with other large cap stocks in the old economy sector, pushing the broader market back into positive territory by the end of the session, they said.
"Look at the expanded turnover. Late session bargain hunting played an important role in boosting trading volume for the entire day and also helped the weighted index climb out of the previous weakness," Concord Securities analyst Kerry Huang said.
"It seems that many investors remained bullish and willing to take advantage of the earlier losses on the weighted index, hoping the Taiex will soon return to an upswing after recent consolidation," Huang said.
Huang said TSMC's rebound from its earlier heavy losses served as a driver for the comeback of the broader market.
After hitting a low of NT$249.50, TSMC, the world's largest contract chipmaker, closed unchanged at NT$255.00 with 62.90 million shares changing hands.
Shares in contract notebook computer manufacturer Compal Electronics Inc. rose 0.97 percent to close at NT$20.80, off an early high of NT$20.45 also on the back of bargain hunting.
Nanya Technology Corp., the largest dynamic random access memory (DRAM) chip maker in Taiwan, gained 3.52 percent to close at NT$94.20 after an IC Insights research report said a day earlier that DRAM prices are expected to rise another 36 percent on average in 2018 following an 81 percent increase in 2017, as demand continues to outstrip supply.
However, shares in iPhone Assembler Hon Hai Precision Industry Co., second to TSMC in terms of market value, fell 0.64 percent to close at NT$92.80, and Largan Precision Co., a smartphone camera lens supplier to Apple Inc. shed 2.51 percent to end at NT$3,690.00.
Also bolstered by bargain hunters, Formosa Plastics Corp. closed unchanged at NT$102.00, off an early low of NT$100.50, while Formosa Chemicals and Fibre Corp. ended up 2.80 percent at NT$110.00 after hitting a low of NT$106.50.
"Despite the gains, I remain concerned about the stiff technical resistance ahead of 11,270 points, the intraday high seen on Jan. 21," Huang said.
"More important, possible volatility on Wall Street at a time of a rate hike cycle by the U.S. Federal Reserve this year is expected to continue to dictate the local main board down the road," Huang added.
Source: Focus Taiwan News Channel