Shares in Taiwan closed slightly higher Monday as the electronics sector gave up its earlier gains with many investors reluctant to chase prices despite initial gains, dealers said.

Buying rotated to old economy stocks, in particular the transportation sector, which served as an anchor stabilizing the broader market at a time of lingering concerns over further volatility on global markets, they said.

The Taiex, the weighted index on the Taiwan Stock Exchange (TWSE), ended up 11.56 points, or 0.07 percent, at 16,156.41, after moving between 16,125.45 and 16,249.45. Turnover totaled NT$232.94 billion (US$7.85 billion).

The market opened up 0.30 percent after local investors witnessed a rebound on the United States markets, with the Dow Jones Industrial Average rising 8.80 points or 0.03 percent after recovering from an earlier 600 point plunge, dealers said.

Buying initially focused on large cap semiconductor stocks and spread to shipping stocks, pushing the Taiex past the 16,200 point mark in the early morning session before selling emerged to push down the electronics sector as well as the broader market by the end of trading, they said.

The electronics sector fell 0.41 percent to close at 748.56, off a high of 757.37, with the semiconductor sub-index down 0.51 percent, while the transportation sector, where several major container cargo shippers are traded, soared 6.43 percent.

“Today’s turnover remained moderate with many investors on the sidelines so electronic stocks, in particular semiconductor heavyweights, found it hard to sustain their earlier gains,” More Rich Securities Investment Consulting analyst Adam Lin said.

“The Taiex faces strong technical resistance ahead of 16,246 points, the 20-day moving average,” Lin said.

Contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC), the most heavily weighted stock on the local market, lost 0.38 percent to close at NT$528.00 after coming off a high of NT$534.00, while United Microelectronics Corp., a smaller contract chipmaker in Taiwan, fell 0.79 percent to end at NT$50.30, after hitting NT$51.40.

Among other semiconductor stocks, smartphone chip designer MediaTek Inc. dropped 0.35 percent to close at NT$843.00, while IC packaging and testing services provider ASE Technology Holding Co. ended unchanged at NT$97.50.

In contrast, IC substrate maker Kinsus Interconnect Technology Corp. bucked the downturn, rising 1.48 percent to close at NT$171.50.

Also in the electronics sector, shares in iPhone assembler Hon Hai Precision Industry Co., the world’s largest contract electronics maker, rose 0.93 percent to end at NT$108.00 on hopes over its efforts in electric vehicles.

In addition, Quanta Computer Inc., the world’s largest notebook computer ODM services provider, gained 1.34 percent to end at NT$75.50 as the company said difficulties with workers at its Shanghai plant caused by a strict lockdown in the city against COVID-19 infections has been resolved.

“I am not especially worried about the prospects of the electronics sector as concerns over a rate hike cycle by the U.S. Federal Reserve have been priced in to a large extent,” Lin said. “Today’s movement was due to rapid rotational buying which mainly boosted the transportation sector.”

In the wake of a rebound in share price enjoyed by Hapag-Lloyd and Maersk, two multinational container cargo shippers, Evergreen Marine Corp., the largest container cargo shipping services provider in Taiwan, soared 6.67 percent to close at NT$144.00.

Its rivals Yang Ming Marine Transport Corp. and Wan Hai Lines Ltd. surged 8.09 percent and 10 percent, the maximum daily increase, respectively, to end at NT$127.00 and NT$163.50.

“The three shippers are scheduled to hold their annual general meeting later this week. The buying also showed that investors expect the three companies to give positive leads at those meetings,” Lin said.

Elsewhere in the old economy sector, shares in Formosa Plastics Corp. rose 0.48 percent to close at NT$105.00, and Formosa Chemicals & Fibre Corp. gained 0.38 percent to end at NT$80.00.

However, Eclat Textile Co. lost 1.93 percent to close at NT$456.50 and rival Makalot Industrial Co. fell 0.94 percent to end at NT$158.50.

In the financial sector, which was mixed, ending 0.05 percent higher, Fubon Financial Holding Co. lost 2.10 percent to close at NT$60.50, but E. Sun Financial Holding Co. rose 1.90 percent to end at NT$29.45.

“In addition to the planned shareholder meetings this week, investors should also pay close attention to the U.S. personal consumption expenditure (PCE) price index for more clues about inflationary pressure due later the week on the U.S. market,” Lin said

According to the TWSE, foreign institutional investors bought a net NT$2.03 billion worth of shares on the main board Monday.

Source: Focus Taiwan News Channel