Taipei, March 20 (CNA) Shares in Taiwan closed little changed Monday, moving in consolidation mode after the local main board's strong showing in recent sessions, dealers said.
Sentiment turned cautious about possible stiff technical resistance ahead of the 10,000-point mark and many investors took to the sidelines, which dragged down turnover and left some large-cap stocks in the doldrums, dealers said.
The weighted index on the Taiwan Stock Exchange ended up 4.28 points, or 0.04 percent, at 9,912.97, after fluctuating between 9,869.35 and 9,916.18. Turnover totaled of NT$82.65 billion (US$2.71 billion) during the session after reaching NT$109.55 billion last Friday.
The market opened down 2.88 points as investors took cues from a lackluster Wall Street, where the Dow Jones Industrial Average closed down 0.10 percent and the S&P 500 index ended 0.13 percent lower in reflection of mixed economic data in Washington on Friday, dealers said.
Selling increased on the local main board, pushing the index below 9,900 points at one point, as investors locked in their gains from last week, but later bargain hunting helped the index return to that level by the end of the session, dealers said.
"The reduced trading volume was an indication of caution as the index moved closer to the 10,000-point mark, which is a massive technical resistance point," equity market analyst Vickie Hsieh said.
"However, the local equity remained awash in liquidity and that's why investors were willing to chase bargains in the hopes that the local weighted index will resume its uptrend despite the pullback now," Hsieh said.
She said the U.S. Federal Reserve's recent decision on a gradual rate hike cycle for the rest of the year had already been factored into equity markets worldwide and investors in the local market were now awaiting new leads.
"Select market heavyweights managed to recover their early losses but the local equity market remained in consolidation mode after the index breached 9,900 points last week," Hsieh said.
Among the large-cap stocks, contract chip maker Taiwan Semiconductor Manufacturing Co. (台積電), the most heavily weighted stock in the local market, closed unchanged at NT$191.50, off an early low of NT$189.50.
Also in the high-tech sector, integrated circuit packaging and testing services provider Advanced Semiconductor Engineering Inc. (日月光) rose 0.26 percent to end at NT$39.30 after hitting a low of NT$39.20.
The petrochemical sector rebounded, gaining 0.11 percent by the close after a slump last week caused by falling international crude oil prices.
Among the gaining petrochemical stocks, Formosa Plastics Corp. (台塑) rose 0.55 percent to close at NT$91.80, and Nan Ya Plastics Corp. (南亞) added 0.42 percent to end at NT$71.80.
"Unless turnover expands to more than NT$100 billion, large-cap stocks are unlikely to make a breakthrough and the broader market is expected to remain in consolidation," Hsieh said.
(By Frances Huang)