Taiwan shares end moderately up on thin turnover

2019/06/18 17:59:29 fontsize-small fontsize-default fontsize-big
Taiwan shares end moderately up on thin turnover

Taipei, June 18 (CNA) Shares in Taiwan closed moderately higher Tuesday, but turnover remained low amid lingering concerns over trade friction between the United States and China, dealers said.

The bellwether electronics sector moved higher as contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC) led other integrated circuit stocks higher, pushing up the broader market, but the gains were capped as a result of low trading volume, they said.

In addition to global trade issues, dealers said, market sentiment is also concerned about the U.S. Federal Reserve two-day policymaking meeting scheduled to start later in the day.

The weighted index on the Taiwan Stock Exchange (TWSE) or the Taiex ended up 36.20 points, or 0.34 percent, at 10,566.74, after moving between 10,521.70 and 10,573.77, on turnover of NT$80.09 billion (US$2.54 billion).

The market opened up 0.15 percent in the wake of a lackluster Dow Jones Industrial Average, which rose 0.09 percent overnight, and the Taiex continued to move in a narrow range for the rest of the session, dealers said.

During the session, buying focused on TSMC and other electronics heavyweights, accelerating in the late trading session, which helped the Taiex close above the previous closing level, dealers added.

"Today was another quiet trading session as many investors appeared reluctant to chase prices for the moment, although the Taiex was trading higher," Mega International Investment Services Corp. analyst Alex Huang said.

"This trading pattern has been repeated in recent sessions as the market remains cautious about the upcoming G20 summit, waiting anxiously for details on a possible meeting between U.S. President Donald Trump and Chinese President Xi Jinping and even talks," Huang said.

Huang said the market is watching closely to see if the tariffs imposed by the U.S. on an additional US$300 billion worth of Chinese goods will take effect, with a congressional hearing starting on Monday.

"For the moment, I prefer to say the gains were technical in nature," he added. "Before the Taiex closes above the nearest technical resistance of the 60-day moving average of 10,671 points, the main board is expected to continue to consolidate."

The bellwether electronics sector closed up 0.34 percent as bargain hunters picked up semiconductor stocks, in particular TSMC, which has come under pressure over worries about the impact of Washington's business restrictions on Chinese telecom equipment provider Huawei Technologies, a client of the Taiwanese chipmaker.

TSMC, the most heavily weighted stock on the local market, gained 1.07 percent to close at NT$235.50 with 28.54 million shares changing hands. TSMC's gains contributed an increase of 25 points to the Taiex by the end of the session.

Led by TSMC, IC designer MediaTek Inc. added 2.66 percent to end at NT$308.50, and IC packaging and testing services provider King Yuan Electronics Co. gained 3.01 percent to close at NT$25.70.

Also in the tech sector, shares in PC brand Asustek Computer Inc. rose 1.83 percent to end at NT$222.00, while iPhone assembler Hon Hai Precision Industry Co. fell 0.65 percent to close at NT$75.90, and Largan Precision Co., a supplier of smartphone camera lenses to Apple Inc., lost 0.80 percent to end at NT$3,705.00.

Non-tech stocks also generally moved higher with Taiwan Cement Corp. up 1.12 percent to close at NT$45.20, and food brand Uni-President Enterprises Corp. up 0.63 percent to end at NT$80.40.

In the financial sector, Fubon Financial Holding Co. rose 0.91 percent to close at NT$44.50, and Cathay Financial Holding Co. gained 1.32 percent to end at NT$42.20.

"Investors have also been looking forward to comments from the Fed after the policymaking meeting for more clues about the central bank's attitude toward interest rates," Huang said.

With concerns that global trade issues will impact the economy running deep, investors in financial markets worldwide are hoping the Fed will become more dovish and even cut interest rates in the second half of this year.

According to the TWSE, foreign institutional investors bought a net NT$1.54 billion worth of shares on the main board Tuesday.

(By Frances Huang)

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