Semiconductor sector's market cap down over 9% amid U.S. volatility

2018/02/10 15:02:13 fontsize-small fontsize-default fontsize-big
Semiconductor sector's market cap down over 9% amid U.S. volatility

Taipei, Feb. 10 (CNA) The market capitalization of Taiwan's semiconductor sector fell more than 9 percent this week as the local stock market was hammered by massive foreign institutional selling amid huge volatility on Wall Street, according to the Taiwan Stock Exchange (TWSE).

The semiconductor index fell 9.73 percent for the week, the biggest plunge of any major sector on Taiwan's stock exchange, and listed semiconductor companies' stocks as a whole saw 9.6 percent, or NT$983.1 billion (US$33.44 billion), of their market capitalization evaporate, TWSE data showed.

By the market's close Friday, the market value of those companies was down to NT$9.22 trillion, the data showed.

For the week, the market's benchmark index, the Taiex, plunged 754.48 points, or 6.78 percent, in the wake of heavy losses in the United States, where the Dow Jones Industrial Average fell about 1,000 points, or 5.2 percent, over the week amid rising concerns that the U.S. Federal Reserve will raise interest rates at a faster pace than previously expected.

On Friday, the Taiex fell as low as 10,189.04, before closing down 1.49 percent at 10,371.75, falling below the 240-day moving average of 10,395.

"Falling below 10,395 points has made the main board technically weaker, although the weighted index came off its low by the end of the session," Hua Nan Securities analyst Kevin Su said.

"It's unlikely that the market will have a meaningful rebound unless Wall Street stabilizes. But there are no signs that Wall Street will soon turn stable," Su said.

With the 5.2 percent drop on the Dow, the worst weekly decline in two years, foreign institutional investors rushed to dump liquid large-cap high-tech stocks in Taiwan to meet margin calls back home, and Taiwan's semiconductor sector was the biggest victim of the sell-off.

Contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC), the most heavily weighted stock in the local market, was the biggest loser of market value after falling 10.4 percent during the week to close at NT$232.50 on Friday.

The dive, spurred by the net sale of 121.25 million shares by foreign institutional investors, wiped NT$700.1 billion from TSMC's market capitalization, leaving its market value at NT$6.02 trillion, the data showed.

Integrated circuit designer MediaTek Inc. suffered the second steepest market cap loss of NT$34 billion, followed by IC packaging and testing service provider Advanced Semiconductor Engineering Inc., which saw its market cap fall by NT$33.2 billion, the data showed.

For the week, market cap of the stock market as a whole fell more than NT$2.2 trillion, or 6.71 percent of its value, to NT$31.11 trillion, the TWSE said.

Based on 3.12 million investors having securities trading accounts in Taiwan, the market cap tumble meant investors saw their portfolios shrink in value by an average of NT$723,583 during the week, the TWSE said.

(By Chang Chien-chung, Tien Yu-pin and Frances Huang)
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