Taipei, April 21 (CNA) Shares in Taiwan staged a technical rebound on Friday, closing above the 9,700-point mark with the help of momentum shown by large-cap stocks after Wall Street posted gains overnight, dealers said.
Turnover remained thin, however, as investors were cautious ahead of the first round of France's presidential election on Sunday, as the results were likely to affect global financial markets, they said.
The weighted index on the Taiwan Stock Exchange closed up 84.72 points, or 0.88 percent, at 9,717.41, after moving between 9,657.05 and 9,718.82, on turnover of NT$70.15 billion (US$2.32 billion).
The market opened 0.25 percent higher in reaction to gains in American markets, where the Dow Jones Industrial Average closed up 0.85 percent and the tech-heavy Nasdaq index ended 0.92 percent higher on an improvement in corporate earnings, dealers said.
Local blue chips, led by contract chip maker Taiwan Semiconductor Manufacturing Co. (TSMC, 台積電) and smartphone camera lens supplier Largan Precision Co. (大立光), benefited, helping the weighted index overcome technical resistance at around 9,715 points, the 60-day moving average, they said.
"Jumping over the technical hurdles created by the 60-day moving average made the market technically healthier, leaving behind the bearish mood caused by the losses in previous sessions," Mega International Investment Services Corp. analyst Alex Huang said.
"While financial and old economy stocks made a comeback today, buying focused on large-cap electronics stocks, giving a real boost to the main board," Huang said.
TSMC, the most heavily weighted stock in the local market, gained 1.60 percent to close at the day's high of NT$190.00, with 17.37 million shares changing hands.
The gains by TSMC helped propel the bellwether electronics sector 1.16 percent higher and the semiconductor sub-index 1.35 percent higher on the day.
Also in the high-tech sector, Largan, a supplier to Apple Inc., added 3.17 percent to end at NT$4,875.00, the highest closing level in the stock's history, to remain the most expensive stock in the local market.
Investors remain optimistic about the company's fundamentals at a time when a growing number of international smartphone brands have been adopting the dual camera lenses that Largan makes in their devices.
PC vendor Asustek Computer Inc. (華碩) rose 2.43 percent to close at NT$294.50, while flat panel maker Innolux Corp. (群創) fell 0.71 percent to end at NT$14.00.
In the non-high-tech sector, food maker Uni-President Enterprises Corp. (統一) gained 1.09 percent to close at NT$55.70, and Formosa Plastics Corp. (台塑) added 0.77 percent to end at NT$91.70.
Bucking the upturn on the broader market, Taiwan Cement Corp. (台泥) fell 2.33 percent to close at NT$35.60 after it announced on Thursday it would acquire the shares of subsidiary TCC International Holdings Co. it does not own and then delist TCC International from the Hong Kong Stock Exchange.
Investors were concerned that the 38.5 percent premium Taiwan Cement is paying for the outstanding shares, based on TCC International's closing price on Tuesday, was too high.
Even though the overall market gained ground Friday, there was still reason to be cautious, Huang said.
"Today's gains were technical in nature and market sentiment remained haunted by uncertainty over the election in France," Huang said. "The low turnover also reflected lingering concerns over geopolitical tensions related to North Korea."
"At home, investors are still waiting for the first quarter earnings reports from high-tech firms whose bottom lines have been squeezed by a stronger Taiwan dollar in the first quarter," Huang said.
(By Frances Huang)