Taipei, Nov. 24 (CNA) Shares in Taiwan closed slightly lower Wednesday as the bellwether electronics sector experienced some selling off, sparked by volatility among tech stocks on the United States markets overnight, dealers said.

Old economy stocks, in particular in the petrochemical sector, mainly trended higher on the back of a spike in international crude oil prices despite an announcement by the Joe Biden administration on a coordinated U.S.-led effort by energy-consuming countries to release strategic crude reserves to rein in oil prices, they said.

The Taiex, the weighted index on the Taiwan Stock Exchange (TWSE), ended down 23.60 points, or 0.13 percent, at 17,642.52, after moving between 17,588.78 and 17,722.89. Turnover totaled NT$291.87 billion (US$10.50 billion).

The market opened up 14.04 points and soon rose to the day’s high on a technical rebound from a 0.77-percent slump a session earlier, and selling followed, mainly in electronics stocks, in particular in the semiconductor industry, in the wake of a 0.5-percent fall on the tech-heavy Nasdaq index on Tuesday, dealers said.

However, with the Taiex breaching the 17,600-point mark, bargain hunters became active, rushing to pick up old economy stocks such as petrochemical stocks and helping the broader market recover part of its earlier losses by the end of the session, they said.

“The benchmark 10-year U.S. treasury yield topped 1.6 percent overnight, making tech stocks on the American markets less attractive, triggering selling. This caution also affected their counterparts in Taiwan today,” Hua Nan Securities analyst Kevin Su said.

“Semiconductor stocks came under heavier pressure due to their relatively high valuations,” Su said. “TSMC (Taiwan Semiconductor Manufacturing Co.) was highlighted.”

Contract chipmaker TSMC, the most heavily weighted stock in the local market, fell 1.47 percent to close at NT$603.00. Led by TSMC, the electronics sector fell 0.73 percent while the semiconductor sub-index finished down by 1.28 percent.

Among other large-cap semiconductor stocks, integrated circuit packaging and testing services provider ASE Technology Holding Co. fell 1.90 percent to end at NT$103.00, while IC designer MediaTek Inc. decreased by 1.42 percent to close at NT$1,040.00

United Microelectronics Corp., a smaller contract chipmaker, fell 0.16 percent to end at NT$63.10.

Also in the electronics sector, iPhone assembler Hon Hai Precision Industry Co. dropped by 0.47 percent to close at NT$105.50, and Quanta Computer Inc., the world’s largest contract notebook computer maker, fell 0.65 percent to end at NT$87.00.

Bucking the downturn, the optoelectronics sector, rose by 0.48 percent, Su said.

In the sector, Largan Precision Co., a supplier of smartphone camera lenses to Apple Inc., rose 1.23 percent to close at NT$2,060.00, and flat panel maker Innolux Corp. increased by 0.81 percent to end at NT$18.65.

“Thanks to the resilient old economy sector, the Taiex saw its losses limited,” Su said. “Petrochemical stocks provided major support to the broader market after crude prices spiked despite Biden’s move.”

As the No. 4 stock in terms of market capitalization on the local main board, Formosa Petrochemical Corp. soared by 2.92 percent to close at NT$98.80, leading the petrochemical sector as it moved up by 0.93 percent.

Among other petrochemical stocks, Nan Ya Plastics Corp. rose by 0.93 percent to end at NT$86.40, Formosa Plastics Corp. increased by 0.95 percent to close at NT$106.00, and Taita Chemical Co. rose by 1.14 percent to end at NT$35.50.

Elsewhere, the transportation sector staged a technical rebound as it finished up 1.84 percent with China Airlines soaring by 8.29 percent to close at NT$30.05, and EVA Airways surging by 10 percent, the maximum daily increase, to end at NT$28.35.

In addition, container cargo shipper Evergreen Marine Corp. rose by 0.42 percent to close at NT$120.00, while Yang Ming Marine Transport Corp. ended unchanged at NT$111.00.

As for the financial sector, it rose by 0.67 percent on hopes that interest rates globally will be raised higher, which would boost financial firms’ profitability.

In the sector, CTBC Financial Holding Co. increased by 1.22 percent to close at NT$24.80, and E. Sun Financial Holding Co. rose by 2.19 percent to end at NT$28.00.

“The Taiex fell below the 10-day moving average of 17,684 today and could incur more losses,” Su said. “But, the main board is likely to see strong technical support at around the 20-day moving average of 17,450 points,” Su said.

Despite the fall in the Taiex, foreign institutional investors bought a net NT$682 million worth of shares on the main board Wednesday.

(By Frances Huang)


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