Taipei, Shares in Taiwan staged a technical rebound Monday from the previous session as "Apple concept stocks" moved higher ahead of the more cheaply priced iPhone XR going on sale worldwide later in the week, dealers said.
While the bellwether electronics sector was behind the latest rebound, old economy and financial stocks were mixed, with many investors staying on the sidelines, which ensured turnover remained moderate, they said.
Market sentiment remained cautious amid lingering concerns that the speed at which the U.S. Federal Reserve is raising interest rates could lead more fund outflows from the region, they added.
The weighted index on the Taiwan Stock Exchange (TWSE), or the Taiex, closed up 55.02 points, or 0.55 percent, at 9,974.28, after moving between 9,822.15 and 9,984.15, on turnover of NT$100.76 billion (US$3.26 billion).
The market opened down 0.48 percent on follow-through selling from Friday, when the Taiex ended down 0.35 percent, and soon fell further to the day's low in the early morning session, dealers said.
With the main board moving closer to the 9,800 point mark some bargain hunters emerged, picking up "Apple concept stocks," such as chipmaker Taiwan Semiconductor Manufacturing Co. and smartphone camera supplier Largan Precision Co. to push the broader market back into positive territory by the end of the session, they said.
"Buying in these Apple suppliers reflected optimism over sales of the iPhone XR," which will start on Friday, Xincheng International Investment Consultant analyst Chang Chih-cheng said.
"Due to its relatively affordable price, the iPhone XR is expected to become the most popular of the three newest iPhone models and that expectation encouraged investors to buy into Apple concept stocks," Chang said.
In addition, Chang said, Apple has issued an invitation to the press to a "special event" on Oct. 30, where the market is expecting the firm to unveil new iPads and Macs.
TSMC, the most heavily weighted stock on the local market, rose 0.42 percent to close at NT$237.00 after hitting a low of NT$231.50 with 29.23 million shares changing hands. Led by TSMC, the bellwether electronics sector rose 0.63 percent to end at 396.25, off a low of 387.48.
Among other gaining Apple suppliers, shares in Largan added 2.64 percent to close at NT$3,505.00, off a low of NT$3,325.00, while metal casing maker Catcher Technology Co. grew 0.80 percent to end at NT$315.00, off a low of NT$302.00.
"With the high tech sector serving as a driver to the main board, old economy and financial stocks were mixed during the session," Chang said.
Among old economy stocks, Formosa Chemicals & Fibre Corp. rose 0.88 percent to close at NT$114.50, while Formosa Plastics Corp. remained unchanged to end at NT$103.00, and food brand Uni-President Enterprises Corp. fell 1.07 percent to close at NT$74.10.
In the financial sector, which ended up 0.06 percent, shares in Yuanta Financial Holding Co. rose 1.35 percent to close at NT$15.00, while Mega Financial Holding Co. fell 0.38 percent to end at NT$26.10.
Chang said strong technical resistance remains ahead of 10,000 points, so the market still moved in consolidation mode despite the gains.
"Many investors are reluctant to chase prices for the moment as they remain concerned the Fed could accelerate the speed of its rate hike cycle with the U.S. economy so strong," Chang said, referring to the more hawkish mentality of Fed members seen in the recently released minutes of the September policymaking meeting.
"More importantly, investors have been anxiously watching when foreign institutional investors will resume large buying after recent sell-offs," Chang said.
According to the TWSE, foreign institutional investors bought a net NT$18.99 million worth of shares on the main board Monday. Before today, they had registered net sales of NT$121.96 billion since the beginning of this month.
Source: Focus Taiwan News Channel