Thin trade in shares
Taiwanese shares closed up 0.26 percent yesterday in thin trade, with many investors sidelined over a lack of new leads, dealers said.
The weighted index rose 11.63 points to 4,425.08 on turnover of NT$29.92 billion (US$907 million).
The market opened down 0.34 percent as investors waited for a new direction to trade, with Wall Street closed for the Christmas holiday, dealers said.
Bargain hunters then emerged to pick up select stocks, including petrochemical and flat panel producers, but gains were limited to the 4,500 point resistance level, they said.
“Amid lingering concerns over the global economy, market confidence remained weak. So bargain hunting failed to boost interest to significantly lift the broader market,” Capital Securities (群益證券) analyst Chen Yu-yu (陳育娛) said.
Chen said that petrochemical stocks appeared attractive on low valuations.
“I suspect the buying came from institutional investors who attempted to boost share prices to dress up their books at the end of the year. Apart from that, nothing has been changed in fundamentals,” he said.
Chen said he expected daily volume to remain low ahead of the New Year holiday.
Flat-panel makers also outperformed the broader market on hopes that the government will step in to rescue the financially troubled sector, dealers said.
Innolux shares rise 4.7%
Innolux Display Corp (群創光電), the world’s second-largest assembler of flat-screen computer monitors, rose the most in almost two weeks in Taipei trading after Fubon Securities Co (富邦證) raised its recommendation and target price.
Innolux climbed NT$0.95, or 4.7 percent, to close at NT$21.30 on the Taiwan Stock Exchange, the biggest gain since Dec. 15. The nation’s benchmark TAIEX index added 0.3 percent.
“Innolux could be more attractive to investors in the cyclical downturn because of its defensive business model,” Fubon said in a note to clients yesterday.
The brokerage upgraded the stock to “neutral” from “sell” and raised its price estimate to NT$20 from NT$18.
Cut prices, foundation says
The government should look into why commodity prices have not dropped to reflect an average 50 percent fall in prices of major raw materials and grain on the world market, the Consumers’ Foundation said on Thursday.
Foundation secretary-general Wu Chia-cheng (吳家誠) quoted Chicago Mercantile Exchange data as showing that international prices for soybeans and wheat have plunged by 48 percent and 56 percent respectively from their peaks recorded earlier this year.
Regrettably, Wu said, domestic prices for corresponding products, including cooking oil, flour and bread, have not reflected such dramatic falls in international raw material prices.
Wu said that domestic cooking oil prices should be lowered by up to 56 percent and bread prices should be cut by 30 percent.
NT dollar rises again
The New Taiwan dollar yesterday strengthened for a third day as exporters converted overseas earnings before the end of the year.
The local currency pared this week’s declines ahead of exporters closing books for the year. Taiwan will probably post a trade surplus of US$18.2 billion for this year, the government’s statistics bureau said last month.
The NT dollar gained NT$0.050 to NT$33.025 against its US counterpart yesterday on turnover of US$492 million, after falling 1.5 percent for the week, according to Taipei Forex Inc.