Taipei, Oct. 9 (CNA) Shares in Taiwan moved higher on a technical rebound Tuesday, ending a five-session falling streak, but gains were capped ahead of stiff technical resistance at around 10,500 points, dealers said.
After falling heavily in recent sessions, contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC), the most heavily weighted stock on the local market, stabilized, while buying in old economy and financial stocks helped the broader market offset the impact of losses suffered by other large cap stocks, they said.
Turnover remained thin, with the market concerned over further fund exodus as a result of a stronger U.S. dollar and trade friction between the United States and China, which could affect global demand and the pace of the economic recovery around the world, dealers said.
The weighted index on the Taiwan Stock Exchange (TWSE) or the Taiex closed up 10.90 points, or 0.10 percent, at 10,466.83, after moving between 10,428.97 and 10,503.10, on turnover of NT$120.63 billion (US$3.90 billion).
The market opened up 8.46 points and moved in a narrow range during the morning session, though buying increased in the afternoon session with TSMC and non-high tech stocks in focus, dealers said.
After the Taiex breached the 10,500 point mark at one point, some investors shifted to the sell side, undermining the upturn by the end of the session, they said.
"After heavy losses in the past few sessions, today's rebound was weak," Mega International Investment Services Corp. Alex Huang said. "Since high technical hurdles are ahead of 10,500 points, many investors were reluctant to chase prices despite the rebound."
Over the last five sessions, the Taiex lost 595.87 points or 5.39 percent.
"Thanks to TSMC, the local main board took a breather today," Huang said. "But compared with the stock's recent plunge, today's gains were not significant at all."
Shares in TSMC rose 0.21 percent to close at NT$244.50 with 28.87 million shares changing hands. TSMC shares had fallen 7.41 percent, sending the local main board into a tailspin as the market turned bearish about the global semiconductor industry.
"Other major tech stocks also came under pressure in the wake of the losses caused by U.S. counterparts overnight," Huang said, referring to the Nasdaq, which fell 0.67 percent.
Among the falling tech stocks, integrated circuit designer MediaTek Inc. fell 2.14 percent to close at NT$228.50 and IC packaging and testing services provider ASE Technology Holding Co. lost 1.58 percent to end at NT$68.60.
Huang said the main board also received a boost from buying in old economy and financial stocks. "I suspect the buying came from government-led funds," he added.
In the old economy sector, shares in Formosa Chemicals & Fiber Corp. gained 2.06 percent to close at NT$124.00, Formosa Petrochemical Corp. rose 1.50 percent to end at NT$135.00 and Far Eastern New Century Corp. grew 2.28 percent to close at NT$35.85.
Among gaining financial stocks, shares in E. Sun Financial Holding Co. rose 1.36 percent to close at NT$22.35, and Mega Financial Holding Co. added 2.04 percent to end at NT$27.55.
"The Washington-Beijing trade dispute still dominates market sentiment and worries over a higher greenback leading to fund outflows remain a concern so I do not think it will be easy for the Taiex to bounce back significantly anytime soon," Huang said.
According to the TWSE, foreign institutional investors sold a net NT$5.72 billion worth of shares on the main board Tuesday.
Source: Focus Taiwan News Channel