Taiwanese shares yesterday moved lower as investors took a cue from an overnight decline on Wall Street amid concerns over a possible trade war between the US and China, but the downturn was limited by bargain-hunting that saw the broader market remain above 10,800 points at the close, dealers said.
The bellwether electronics sector led the decline amid investor worry over possible volatility among US tech stocks, while non-high tech stocks, in particular in the old economy sector, outperformed the broader market to prevent further losses, they said.
Turnover was low, as many investors remained on the sidelines ahead of the five-day Tomb Sweeping holiday that starts today, amid concerns over possible negative developments on global markets during the break, they added.
The TAIEX ended down 66.74 points, or 0.61 percent, at 10,821.53, after moving between 10,775.45 and 10,837.54, on turnover of NT$115.78 billion (US$3.97 billion).
The stock market opened down 0.47 percent and fell by more than 110 points, reflecting the decline on Wall Street, where the Dow Jones Industrial Average closed down 1.9 percent and the NASDAQ Composite ended down 2.74 percent overnight, dealers said.
“Compared with Wall Street’s plunge, the local main board appeared resilient,” Mega International Investment Services Corp (兆豐國際投信) analyst Alex Huang (黃國偉) told reporters.
“Taiwan was not the only regional market to be resilient, as many investors in the region are hoping that Washington and Beijing will cut a deal before an all-out trade war breaks out,” Huang said, referring to investors in Hong Kong, Tokyo and Seoul.
Beijing on Monday imposed tariffs on 128 US products, including pork and fruits, which is being viewed as a direct response to US tariffs on steel and aluminum imports.
Yesterday, selling focused on the electronics sector, which closed down 0.89 percent and accounted for about 64 percent of total turnover, as local investors were motivated by the heavy losses incurred by US tech stocks. Contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the most heavily weighted stock on the local market, fell 1.01 percent to close at NT$244, with 35.79 million shares changing hands, after hitting an early low of NT$242.
OLD ECONOMY
Although the electronics sector was in the doldrums, select old-economy stocks provided some support to the TAIEX, Huang said.
Among the outperforming stocks, Century Iron & Steel Industrial Co (世紀鋼構) shares rose 2.94 percent to close at NT$84.10, and China Steel Structure Corp (中鋼結構) rose by the maximum daily 10 percent to end at NT$34.55 on optimism about their investments in offshore wind farms in Taiwan.
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