The main bourse has seen a correction of nearly 5 percent since hitting this year’s high of 8,089 points last month, amid a slew of negative events worldwide.
The TAIEX ended 8.02 points, or 0.10 percent, higher yesterday at 7,809.07. So far this year, the index has increased 1.42 percent, Taiwan Stock Exchange data showed.
Equity strategists are advising investors to look for high-yield stocks this quarter, while avoiding PC-related shares.
In its latest market strategy report, Credit Suisse analyst Jeremy Chen (陳建名) said the brokerage maintained its 8,400-point target for the TAIEX this year, but warned about headwinds like slow growth in China, avian influenza outbreak fears and tensions on the Korean Peninsula rising in the near future.
“This has prompted us to modify our model portfolio with a bias on high-dividend yield plays and defensive stocks amid macro uncertainties,” Chen said in a note to clients yesterday.
Credit Suisse said it had shifted more focus to upstream technology firms such as metal casings maker Catcher Technology Co (可成科技) and power supply unit maker Delta Electronics Inc (台達電), as well as selective financial shares like Chinatrust Financial Holding Co (中信金控), from the downstream PC hardware sector due to its poor outlook for the PC market.
Fubon Securities Investment Services Co (富邦投顧) analyst Kevin Chang (張宜立) agreed, saying his firm also preferred high-yield shares because of the bumpy second quarter that it is expecting.
Fubon also said it would continue to avoid Apple Inc plays such as Hon Hai Group (鴻海集團) affiliates, as well as Windows 8-associated tech shares. It also gave an “underweight” rating to basic materials shares on the back of uncertainties about China’s growth outlook this quarter, Chang said in a separate note.
“Due to external headwinds, we expect policymakers will likely institute more market-friendly policies (related to cross-strait collaboration and reforms in Taiwan’s financial sector) and economic stimulus measures to ensure moderate economic growth in 2013,” he said.
BUSINESS UPDATE: The iPhone assembler said operations outlook is expected to show quarter-on-quarter and year-on-year growth for the second quarter Hon Hai Precision Industry Co (鴻海精密) yesterday reported strong growth in sales last month, potentially raising expectations for iPhone sales while artificial intelligence (AI)-related business booms. The company, which assembles the majority of Apple Inc’s smartphones, reported a 19.03 percent rise in monthly sales to NT$510.9 billion (US$15.78 billion), from NT$429.22 billion in the same period last year. On a monthly basis, sales rose 14.16 percent, it said. The company in a statement said that last month’s revenue was a record-breaking April performance. Hon Hai, known also as Foxconn Technology Group (富士康科技集團), assembles most iPhones, but the company is diversifying its business to
Apple Inc has been developing a homegrown chip to run artificial intelligence (AI) tools in data centers, although it is unclear if the semiconductor would ever be deployed, the Wall Street Journal reported on Monday. The effort would build on Apple’s previous efforts to make in-house chips, which run in its iPhones, Macs and other devices, according to the Journal, which cited unidentified people familiar with the matter. The server project is code-named ACDC (Apple Chips in Data Center) within the company, aiming to utilize Apple’s expertise in chip design for the company’s server infrastructure, the newspaper said. While this initiative has been
GlobalWafers Co (環球晶圓), the world’s No. 3 silicon wafer supplier, yesterday said that revenue would rise moderately in the second half of this year, driven primarily by robust demand for advanced wafers used in high-bandwidth memory (HBM) chips, a key component of artificial intelligence (AI) technology. “The first quarter is the lowest point of this cycle. The second half will be better than the first for the whole semiconductor industry and for GlobalWafers,” chairwoman Doris Hsu (徐秀蘭) said during an online investors’ conference. “HBM would definitely be the key growth driver in the second half,” Hsu said. “That is our big hope
The consumer price index (CPI) last month eased to 1.95 percent, below the central bank’s 2 percent target, as food and entertainment cost increases decelerated, helped by stable egg prices, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday. The slowdown bucked predictions by policymakers and academics that inflationary pressures would build up following double-digit electricity rate hikes on April 1. “The latest CPI data came after the cost of eating out and rent grew moderately amid mixed international raw material prices,” DGBAS official Tsao Chih-hung (曹志弘) told a news conference in Taipei. The central bank in March raised interest rates by