TAIPEI: Shares on the Taiwan Stock Exchange closed lower on Monday, driven by declines in technology stocks following losses in the U.S. markets late last week. Market activity remained subdued due to the absence of many foreign institutional investors who were away for the New Year's Day holiday, making it challenging for the market to mount a recovery.
According to Focus Taiwan, the Taiex, the benchmark weighted index of the Taiwan Stock Exchange, fell by 85.48 points, or 0.37 percent, to close at 23,190.20. The index fluctuated between 23,159.70 and 23,331.67 throughout the trading day, with a turnover of NT$266.62 billion (US$8.13 billion), down from NT$292.62 billion on Friday. The market opened slightly down by 1.42 points and traded within a narrow range until increased selling in the afternoon pushed the index into negative territory by session's end.
The electronics sector, a significant component of the Taiex, saw a decline of 0.42 percent, while the semiconductor sub-index dropped 0.27 percent. These declines mirrored the performance of the tech-heavy Nasdaq index in the United States, which fell by 1.49 percent on Friday. Concord Securities analyst Kerry Huang noted that the Taiex was heavily influenced by the U.S. markets, with electronics stocks showing weakness. The absence of many foreign institutional investors resulted in lighter turnover and left the market in a state of consolidation.
In the tech sector, key players faced losses. MediaTek Inc., a smartphone IC designer, dropped 0.70 percent to close at NT$1,420.00, and ASE Technology Holding Co., an IC packaging and testing services provider, fell 0.91 percent to end at NT$163.50. Alchip Technologies Ltd., an application-specific integrated circuit designer, saw a significant drop of 3.31 percent, closing at NT$3,215.00. Despite these losses, Taiwan Semiconductor Manufacturing Co. (TSMC) remained steady, ending unchanged at NT$1,090.00, which helped prevent further declines in the Taiex.
Other tech-related companies also experienced downturns. Hon Hai Precision Industry Co., an iPhone assembler and AI server manufacturer, lost 0.80 percent to close at NT$185.00. Quanta Computer Inc., another AI server maker, fell 1.03 percent to end at NT$288.00.
The broader market saw pressure on non-tech stocks as well. Formosa Plastics Corp. and Nan Ya Plastics Corp. both faced declines amid ongoing concerns about a global petrochemicals supply surplus. In the food sector, Uni-President Enterprises Corp. and Great Wall Enterprise Co. experienced losses, while the financial sector saw a minor decline of 0.21 percent. However, King's Town Bank saw a rise of 3.73 percent to close at NT$51.90 following an acquisition agreement by SinoPac Financial Holding Co.
Huang suggested that if local investment trust firms engage in strategic buying to enhance their yearly financial statements, the Taiex might see a recovery despite the lack of large foreign institutional participation. According to the Taiwan Stock Exchange, foreign institutional investors sold a net NT$6.70 billion in shares on the market on Monday.