Taipei: Shares in Taiwan extended losses on Monday from the previous session amid fears over further volatility after a recent strong showing, while contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC) staged a technical rebound, helping the broader market mitigate the downturn, dealers said. The Taiex, the Taiwan Stock Exchange's benchmark index, ended down 221.57 points, or 0.52 percent, at 42,449.70 after moving between 41,967.75 and 43,084.51. Turnover totaled NT$983.86 billion (US$30.37 billion).
According to Focus Taiwan, witnessing the tech-heavy Seoul market continue to move lower, investors in Taiwan kept cutting their holdings in semiconductor stocks, reversing an initial upturn. Moore Securities Investment Consulting analyst Adam Lin commented that TSMC appeared resilient on bargain hunting, lending some support to the broader market. However, the Taiex traded below the 60-day moving average of around 43,660 points, indicating ongoing weakness.
Reversing a 7.29 percent plunge from Friday, TSMC, which accounts for over 40 percent of the total market value, rose 1.31 percent to close at NT$2,320.00. Its gains helped the Taiex trim about 240 points in losses. TSMC's investor conference delivered positive leads on Thursday, but the stock still encountered a sell-off on Friday as investors feared that deleveraging in semiconductor stocks in major markets, particularly in South Korea, would exert more pressure on the global tech sector. Lin asserted that there was nothing wrong with TSMC's fundamentals.
Among other semiconductor stocks, United Microelectronics Corp., a smaller contract chipmaker, plunged 10 percent to end at NT$130.00. IC packaging and testing services provider ASE Technology Holding Co. lost 2.77 percent to close at NT$597.00, and smartphone IC designer MediaTek Inc. ended down 0.89 percent at NT$3,340.00. In the electronics sector, iPhone assembler and AI server maker Hon Hai Precision Industry Co. rose 0.21 percent to close at NT$234.50, while power management solution provider Delta Electronics Inc. fell 2.01 percent to end at NT$1,705.00.
Lin noted that bargain hunters also picked up select financial stocks, suggesting the possibility that government-led funds might be behind the buying. Mega Financial Holding Co. rose 1.26 percent to close at NT$48.20, and E. Sun Financial Holding Co. gained 2.14 percent to end at NT$35.85. Conversely, Fubon Financial Holding Co. closed down 0.80 percent at NT$123.50.
In the old economy sector, Formosa Plastics Corp. lost 3.50 percent to close at NT$60.60, and Nan Ya Plastics Corp. slid 6.28 percent to end at NT$186.50. Additionally, textile brand Far Eastern New Century Corp. closed down 1.44 percent at NT$27.30. Lin advised investors to pay close attention to the stabilization of tech stocks overseas for clues about the Taiex's performance, also emphasizing the significance of monitoring foreign institutional investors' actions.
According to the Taiwan Stock Exchange, foreign institutional investors sold a net NT$6.08 billion of shares on the main board on Monday, following a historical high of NT$189.04 billion in net sales on Friday.