Taiwanese shares moved slightly lower yesterday as investors pocketed initial gains built on a technical rebound in US markets overnight.
However, turnover remained thin amid fears over possible negative leads during the four-day Mid-Autumn Festival holiday, which starts on Saturday, dealers said.
The TAIEX closed down 11.41 points, or 0.07 percent, at 17,434.90, with turnover of NT$257.229 billion (US$9.28 billion).
Foreign institutional investors bought a net NT$6.54 billion of shares on the main board, Taiwan Stock Exchange data showed.
“Despite the initial gains, investors appeared reluctant to chase prices before the upcoming four-day long weekend,” Cathay Futures Consultant Co (國泰證期顧問) analyst Tsai Ming-han (蔡明翰) said.
“With many investors turning away from the trading floor, turnover remained light, which was not favorable for tech heavyweights to sustain their earlier upturn,” Tsai said, adding that a breakthrough is not expected soon.
The tech sector accounted for less than 50 percent of total turnover, prompting the consolidation on the main board, he said.
The electronics index closed down 0.02 percent at 825.24, with the semiconductor subindex down 0.05 percent, the data showed.
“Old economy stocks, in particular in the steel and shipping industries, encountered profit taking, which placed pressure on the broader market,” Tsai said, referring to a retreat among many local investors who previously favored the stocks.
The transportation sector closed down 4.14 percent, while the steel sector lost 1.61 percent, the data showed.
“I expect trading will continue to be quiet before the holiday, with the TAIEX perhaps moving around the 60-day moving average of 17,411 points,” Tsai said. “As foreign institutional investors are largely standing on the buy side, it is unlikely the main board will suffer a major pullback after the holiday ends.”
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