Local shares slid 0.8 percent as investors turned cautious yesterday in the wake of accusations of irregularities involving two construction firms, analysts said.
The TAIEX, which gained more than 3,000 points since November and touched 7,084 points during trading on Monday, has come under pressure for a correction, said Winson Wang (王榮旭), an analyst at Marbo Securities Consultant Co (萬寶證券投顧).
The benchmark index fell 55.94 points to 6,893.14 after fluctuating between 6,847.76 and 6,931.29, Taiwan Stock Exchange Inc (TWSE) statistics show.
Transactions amounted to NT$156.2 billion (US$4.8 billion) with foreign funds buying a net NT$8.11 billion, TWSE data showed.
ADJUSTMENTS
“It is not uncommon for investors to adjust their portfolio after unfavorable reports about listed companies come to light,” Wang said by telephone.
“The correction for the two construction firms in particular may persist for a while,” he said.
The probe into China Metal Products Group (勤美建設) and Prince Housing and Development Corp (太子建設) over insider trading, breach of trust and forgery triggered panic selling of their stocks, which closed down by their daily limit to NT$37.5 and NT$17.5 respectively.
The construction sub-index dropped 5.7 percent and dragged down asset issues by 3.7 percent, TWSE tallies showed.
The stock exchange said it would not take action against the two firms before the investigation is finished.
Analysts said the investigation has had a limited impact on the local bourse, which will resume its bullish performance after the adjustment ends.
“The stock market will continue to benefit from excess capital at home and abroad,” Wang said.
He predicted the index would move above the 7,000-point level later this month.
OPTIMISM
Mike Chow (周道中), a senior manager at Yuanta Core Pacific Capital Management (元大京華投顧), was also optimistic. He thinks the TAIEX will pick up in a day or two now that the global slump has stabilized.
“It is unlikely the stock market would take a dive when economic data in the US and elsewhere have shown improvement,” Chow said by telephone.
He dismissed links between the probe and the dip in the TAIEX, saying profit-taking accounted for the adjustment.
Idle funds would continue to dominate the equity market in the short run, he said.
But Ta Chong Bank (大眾銀行) chairman Chen Chien-ping (陳建平) said market momentum may not be strong enough to sustain the liquidity-driven rally.
The local capital market had recently seen full participation by retail investors instead of institutional investors, which may trigger fluctuations this quarter, Chen said.
ADDITIONAL REPORTING BY JOYCE HUANG
RECYCLE: Taiwan would aid manufacturers in refining rare earths from discarded appliances, which would fit the nation’s circular economy goals, minister Kung said Taiwan would work with the US and Japan on a proposed cooperation initiative in response to Beijing’s newly announced rare earth export curbs, Minister of Economic Affairs Kung Ming-hsin (龔明鑫) said yesterday. China last week announced new restrictions requiring companies to obtain export licenses if their products contain more than 0.1 percent of Chinese-origin rare earths by value. US Secretary of the Treasury Scott Bessent on Wednesday responded by saying that Beijing was “unreliable” in its rare earths exports, adding that the US would “neither be commanded, nor controlled” by China, several media outlets reported. Japanese Minister of Finance Katsunobu Kato yesterday also
Taiwan’s rapidly aging population is fueling a sharp increase in homes occupied solely by elderly people, a trend that is reshaping the nation’s housing market and social fabric, real-estate brokers said yesterday. About 850,000 residences were occupied by elderly people in the first quarter, including 655,000 that housed only one resident, the Ministry of the Interior said. The figures have nearly doubled from a decade earlier, Great Home Realty Co (大家房屋) said, as people aged 65 and older now make up 20.8 percent of the population. “The so-called silver tsunami represents more than just a demographic shift — it could fundamentally redefine the
China Airlines Ltd (CAL, 中華航空) said it expects peak season effects in the fourth quarter to continue to boost demand for passenger flights and cargo services, after reporting its second-highest-ever September sales on Monday. The carrier said it posted NT$15.88 billion (US$517 million) in consolidated sales last month, trailing only September last year’s NT$16.01 billion. Last month, CAL generated NT$8.77 billion from its passenger flights and NT$5.37 billion from cargo services, it said. In the first nine months of this year, the carrier posted NT$154.93 billion in cumulative sales, up 2.62 percent from a year earlier, marking the second-highest level for the January-September
‘DRAMATIC AND POSITIVE’: AI growth would be better than it previously forecast and would stay robust even if the Chinese market became inaccessible for customers, it said Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday raised its full-year revenue growth outlook after posting record profit for last quarter, despite growing market concern about an artificial intelligence (AI) bubble. The company said it expects revenue to expand about 35 percent year-on-year, driven mainly by faster-than-expected demand for leading-edge chips for AI applications. The world’s biggest contract chipmaker in July projected that revenue this year would expand about 30 percent in US dollar terms. The company also slightly hiked its capital expenditure for this year to US$40 billion to US$42 billion, compared with US$38 billion to US$42 billion it set previously. “AI demand actually
RSS