Taipei, Shares in Taiwan staged a technical rebound to close above the 11,000 point mark Tuesday as bargain hunting took hold almost across the board after the slump seen in the previous session, dealers said.
The bellwether electronics sector steamed ahead, led by select optoelectronics and semiconductor stocks, while old economy stocks, in particular in the cement and petrochemical sectors, attracted buying, pushing up the main board further by the end of the session, they said.
Turnover remained thin as investors preferred to take to the sidelines, watching closely how the trade disputes between the United States and China play out, with Washington planning to impose tariffs on an additional US$200 billion worth of Chinese merchandise, they added.
The weighted index on the Taiwan Stock Exchange (TWSE) or the Taiex closed up 57.16 points, or 0.52 percent, at 11,021.38, after moving between 10,956.49 and 11,028.27, on turnover of NT$113.96 billion (US$3.71 billion).
The market opened up 0.16 percent on a mild technical rebound from Monday, when the Taiex ended down 0.90 percent, and momentum accelerated as select large cap stocks in both the electronics and non-tech sectors rode the wave of bargain hunting, dealers said.
However, with the Taiex breaching 11,000 points, the gains were capped with stiff technical resistance seen ahead of 11,100 points, they said.
"Today's rebound only recovered half of the losses seen the previous day," Mega International Investment Services Corp. analyst Alex Huang said. "Faced with high technical hurdles ahead of 11,100 points, the strength of the rebound was not significant at all."
"In addition to worries over a major technical pullback, investors remain concerned by the escalating trade dispute between the U.S. and China," Huang said, referring to Washington's planned tariffs targeting US$200 billion worth of Chinese goods which the market expects to be implemented soon.
"I am afraid selling caused by worries about the trade issue will continue as the tariffs loom even larger," Huang said.
With many investors staying on the sidelines, Tuesday's trading volume remained thin, lower than the daily average of NT$122.2 billion for the previous 20 trading sessions, he added.
Huang said optoelectronics stocks led the rebound with buying focusing on smartphone camera lens supplier Largan Precision Co., the most expensive stock on the local market.
Encouraged by expectations that Apple Inc. will launch its next generation iPhones on Sept. 12, shares in Largan rose 4.26 percent to close at NT$4,890.00, and buying also spread to its rivals with Genius Electronic Optical Co. up 4.78 percent to end at NT$383.50.
Also in the electronics sector, contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC) rose 0.19 percent to close at NT$257.50 with 34.20 million shares changing hands, while iPhone assembler Hon Hai Precision Industry Co., second to TSMC in terms of market value, ended unchanged at NT$80.10.
Boosted by bargain hunting, shares in Formosa Plastics Corp. rose 1.35 percent to close at NT$112.50, Formosa Chemicals & Fibre Corp. gained 1.25 percent to end at NT$121.50, and Taiwan Cement Corp. rose 1.81 percent to close at NT$442.10, while CTBC Financial Holding Co. added 0.94 percent to close at NT$21.55 and Mega Financial Holding Co. rose 1.17 percent to end at NT$26.05.
According to the TWSE, foreign institutional investors bought a net NT$3.61 billion worth of shares on the main board Tuesday.
Source: Focus Taiwan News Channel