Taipei--Shares in Taiwan closed slightly higher Tuesday as the old economy sector, in particular petrochemical stocks, rode follow-through buying from a session earlier to push up the broader market, dealers said.
After the index closed above the 9,500-point mark Monday, many investors preferred to take a prudent approach toward the local equity market at a time when the global financial markets have been watching closely how U.S. President Donald Trump will formulate his trade policies after he took office Jan. 20, the dealers said.
The weighted index on the Taiwan Stock Exchange ended up 16.55 points, or 0.17 percent, at 9,554.56, after moving between 9,512.56 and 9,555.80, on turnover of NT$93.83 billion (US$3.03 billion).
The market opened down 10.59 points on a mild technical correction from a 0.87 percent increase Monday, and soon moved to the day's low before buying re-emerged, in particular in the mid-morning session, to vault the index back into positive territory, the dealers said.
The strength continued, with non-high-tech stocks in focus, while the bellwether electronics sector appeared mixed to prevent the broader market from moving even higher by the end of the session, they said.
"After the index breached 9,500 points yesterday, it was understandable that the local main board took a pause today," Taishin Securities Investment Advisory analyst Tony Huang said. "Despite the narrow range of trading, turnover still stood at more than NT$90 billion, indicating that many investors remained willing to trade, instead of simply retreating from the market."
"Market sentiment has improved to some extent. It seems that investors have been encouraged by the improved local economic fundamentals," Huang said, referring to Taiwan's gross domestic product for the fourth quarter, which rose 2.58 percent from a year earlier, beating an earlier forecast of 2.37 percent.
Huang said that petrochemical and other old economy stocks served as an anchor to lead the broader market to rise and recoup its earlier losses Tuesday, on the back of a recovery in raw material prices in the global market.
The petrochemical sector closed up 0.87 percent, with Formosa Chemicals and Fiber Corp. (??) gaining 1.34 percent to end at NT$98.00, Formosa Plastics Corp. (??) adding 1.00 percent to close at NT$90.70, and Nan Ya Plastics Corp. (??) rising 0.94 percent to close at NT$75.10.
In the financial sector, which ended up 0.33 percent, Taishin Financial Holding Co. (???) rose 1.68 percent to close at NT$12.10, and CTBC Financial Holding Co. (???) gained 0.83 percent to end at NT$18.15, while Cathay Financial Holding Co. (???) fell 0.41 percent to close at NT$48.00.
Among the electronics heavyweights, Hon Hai Precision Industry Co., an assembler of iPhones and iPads for Apple Inc., rose 0.94 percent to end at NT$85.80, while Taiwan Semiconductor Manufacturing Co. (???), the most heavily weighted stock, closed unchanged at NT$184.50, and Largan Precision Co. (???), a smartphone camera lens supplier to Apple, ended down 0.55 percent at NT$4,480.00.
"Trump, who has advocated trade protectionism, remains an uncertainty in the global markets. Many investors are still waiting for what policies he will come up with, which could affect market movement," Huang said.
Source: Focus Taiwan News Channel