Buoyed by an across-the-board market rise in Asia amid Europe debt hopes, Taiwan’s stock market ended higher yesterday, with the rally driven by the technology sector, financial sector and traditional industry shares.
The TAIEX closed up 3.09 percent, or 212.83 points, at 7,089.95, after the market fell to a two-year low on Monday, ending 2.4 percent lower at 6,877.12, Taiwan Stock Exchange data showed.
Turnover expanded to NT$114.87 billion (US$3.77 billion), from NT$106.31 billion on Monday, with three institutional investors buying a net total of NT$2.75 billion of shares, after selling a net total of NT$3.79 billion on Monday, data showed.
However, Shih Sheng-fa (施勝發), a fund manager at Prudential Financial Securities Investment Trust Enterprise Co (保德信投信), said confidence remained weak on the local market amid the recent global bear run, despite yesterday’s rebound.
“The renewed interest of foreign equity buying, rebound in large-cap shares, Greece’s escape from a debt default and China’s upcoming holiday buying spree hold the key to the local market’s short-term outlook,” Shih said yesterday.
The TAIEX might also find strong support, if the large-cap Taiwan 50 Index, which accounts for nearly 50 percent of the main bourse’s turnover, could hold above its critical 10-year moving average at around 6,680 points, he said.
Hsiao Chi-wen (蕭棋文), a fund manager at Capital Investment Trust Co (群益投信), said the valuation of Taiwanese shares was lower than six months ago, since the TAIEX has fallen more than 20 percent since it set an intraday high of 9,221 on Feb. 8. The further downside risk is low, but market volatility would likely remain, he said.
Nonetheless, William Dong (董成康), head of research at UBS Securities Pty Ltd, Taipei Branch, said valuation alone was not sufficient to offer support for the market.
Moreover, the continued downtrend in the New Taiwan dollar is poised to be negative to the market, because the impact of more foreign liquidity withdrawn from the local equity market to avoid currency losses is larger than that of any help for exporters, Dong said in a market strategy report yesterday.
The NT dollar has fallen 4.95 percent against the US dollar since the beginning of this month, edging down 0.29 percent so far this year, central bank data shows.
“For market sentiment to improve, what we need to see is the bottoming in fundamentals,” with key indicators including foundry utilization, business climate index and outstanding margin loans, Dong wrote. “Then ... the market should begin to stabilize.”
UBS suggested that foundry utilization might continue trending lower into the fourth quarter, before bottoming out in the first quarter of next year.
As a result, the brokerage forecast the local market would remain volatile into next month, followed by a shallow rebound in November-to-December period, before seeing the nation's fundamentals to bottom out in the first quarter of next year.
ISSUES: Gogoro has been struggling with ballooning losses and was recently embroiled in alleged subsidy fraud, using Chinese-made components instead of locally made parts Gogoro Inc (睿能創意), the nation’s biggest electric scooter maker, yesterday said that its chairman and CEO Horace Luke (陸學森) has resigned amid chronic losses and probes into the company’s alleged involvement in subsidy fraud. The board of directors nominated Reuntex Group (潤泰集團) general counsel Tamon Tseng (曾夢達) as the company’s new chairman, Gogoro said in a statement. Ruentex is Gogoro’s biggest stakeholder. Gogoro Taiwan general manager Henry Chiang (姜家煒) is to serve as acting CEO during the interim period, the statement said. Luke’s departure came as a bombshell yesterday. As a company founder, he has played a key role in pushing for the
China has claimed a breakthrough in developing homegrown chipmaking equipment, an important step in overcoming US sanctions designed to thwart Beijing’s semiconductor goals. State-linked organizations are advised to use a new laser-based immersion lithography machine with a resolution of 65 nanometers or better, the Chinese Ministry of Industry and Information Technology (MIIT) said in an announcement this month. Although the note does not specify the supplier, the spec marks a significant step up from the previous most advanced indigenous equipment — developed by Shanghai Micro Electronics Equipment Group Co (SMEE, 上海微電子) — which stood at about 90 nanometers. MIIT’s claimed advances last
CROSS-STRAIT TENSIONS: The US company could switch orders from TSMC to alternative suppliers, but that would lower chip quality, CEO Jensen Huang said Nvidia Corp CEO Jensen Huang (黃仁勳), whose products have become the hottest commodity in the technology world, on Wednesday said that the scramble for a limited amount of supply has frustrated some customers and raised tensions. “The demand on it is so great, and everyone wants to be first and everyone wants to be most,” he told the audience at a Goldman Sachs Group Inc technology conference in San Francisco. “We probably have more emotional customers today. Deservedly so. It’s tense. We’re trying to do the best we can.” Huang’s company is experiencing strong demand for its latest generation of chips, called
EUROPE ON HOLD: Among a flurry of announcements, Intel said it would postpone new factories in Germany and Poland, but remains committed to its US expansion Intel Corp chief executive officer Pat Gelsinger has landed Amazon.com Inc’s Amazon Web Services (AWS) as a customer for the company’s manufacturing business, potentially bringing work to new plants under construction in the US and boosting his efforts to turn around the embattled chipmaker. Intel and AWS are to coinvest in a custom semiconductor for artificial intelligence computing — what is known as a fabric chip — in a “multiyear, multibillion-dollar framework,” Intel said in a statement on Monday. The work would rely on Intel’s 18A process, an advanced chipmaking technology. Intel shares rose more than 8 percent in late trading after the