Taipei: Shares in Taiwan closed higher Monday on a mild technical rebound, while turnover shrank as many investors stayed alert over possible volatility down the road, dealers said. The Taiex, the Taiwan Stock Exchange's benchmark index, ended up 428.14 points, or 0.96 percent, at 44,999.90 after moving between 44,594.81 and 45,521.63, a rebound from a plunge of 1,683.50 points on Friday. Turnover totaled NT$997.51 billion (US$30.99 billion), down from the average NT$1.55 trillion in the previous five sessions.
According to Focus Taiwan, Concord Capital Management analyst Lu Chin-wei mentioned that compared with Friday's tumble, the gains were limited. The reduced turnover reflected investors' cautious stance amid fears of increased volatility, following a 54 percent surge in the Taiex since the start of the year. Concerns lingered over potential U.S. Federal Reserve interest rate hikes to combat inflationary pressure, which could negatively impact share prices.
The electronics sector, a key component that had driven Friday's losses, saw a recovery. The sector climbed 1.06 percent, led by Taiwan Semiconductor Manufacturing Co. (TSMC), which rose 1.28 percent to NT$2,370.00. TSMC's performance significantly contributed to the Taiex's increase, accounting for about 240 points. Other semiconductor stocks showed mixed results, with MediaTek Inc. rising 0.77 percent, while ASE Technology Holding Co. fell 0.79 percent.
In other tech movements, Hon Hai Precision Industry Co. dropped 0.80 percent, Delta Electronics Inc. surged 5.25 percent, and Quanta Computer Inc. increased 1.38 percent. Select old economy stocks also experienced gains, though less impactful than tech stocks. Formosa Plastics Corp. and Nan Ya Plastics Corp. rose 1.92 percent and 2.36 percent, respectively, while food brands like Uni-President Enterprises Corp. and Wei Chuan Foods Corp. also posted gains.
The financial sector underperformed, with a 0.92 percent decline. Notable decreases included Fubon Financial Holding Co., falling 4.10 percent, and Cathay Financial Holding Co., dropping 4.25 percent. Lu noted that expectations of a hawkish Federal Reserve have strengthened the U.S. dollar against the Taiwan dollar, potentially prompting foreign investors to reduce holdings and withdraw funds, thereby adding market volatility.
The Taiwan Stock Exchange reported that foreign institutional investors sold a net NT$6.01 billion of shares on the main board on Monday.