Russia’s invasion of Ukraine has disrupted the bullish momentum in financial stocks, while the pace of US Federal Reserve interest rate increases and global supply chains adapting to the post-COVID-19 period is expected to continue to affect Taiwanese equities, Allianz Global Investors Taiwan Ltd (安聯投信) said on Friday.
“Concerns over default on Russian sovereign debt and expectations of a slower pace of Fed interest rate adjustments [in light of the Ukraine-Russia war] are unfavorable for the performance of financial stocks,” the company’s Taiwan equity research team said in a note.
Taiwan Stock Exchange (TWSE) data showed that the main bourse’s financial and insurance subindex retreated 3.03 percent last week, reflecting the poor performance of financial sector shares.
Photo: CNA
The exposure of Taiwanese banks, insurers, securities firms and individual investors to the Ukrainian and Russian markets totaled NT$217.9 billion (US$7.78 billion) as of the end of last month, the Financial Supervisory Commission said on Friday.
The nation’s exposure to the two markets was relatively small compared with other countries, the agency said.
As for electronics stocks, Allianz strategists said that the market remains worried about potential adverse effects of supply-demand changes on price and inventory adjustments.
The short-term performance of stocks in the sector largely depends on the respective company’s financial results for the fourth quarter of last year, they said.
So far, traditional industry stocks seem to be safer bets, with investors moving more assets to the sector, Allianz said, adding that stocks of firms in the transportation and steel sectors are performing better than other traditional industry stocks.
The strategists said that in volatile times, investors increasingly favor stocks with medium to long-term growth potential, such as in the high-performance computing, artificial intelligence, servers and electric vehicle sectors.
Shares of semiconductor companies with higher order visibility might also benefit, as investors’ worries over slim inventory have made the stocks quite cheap, Allianz said.
The strategists’ advice came after the TAIEX on Friday closed 0.33 percent higher at 17,652.18 points on a technical rebound, following a 2.55 percent fall in the previous session.
The TAIEX dropped 3.18 percent for the whole of last week, while it has so far this year retreated 3.11 percent, TWSE data showed.
Foreign institutional investors continued to stand on the sell side to unload local equities on Friday, selling a net NT$51.03 billion of shares on the main board, TWSE data showed.
In the week, foreign institutional investors sold a net NT$166.54 billion of local shares after selling a net NT$6.31 billion a week earlier, the exchange's data showed.
The most actively traded stocks last week were semiconductor shares with a total turnover of NT$492 billion, followed by shipping stocks at NT$455.5 billion and electronic component stocks at NT$145 billion, the data showed.
Additional reporting by Kao Shih-ching
Intel Corp chief executive officer Lip-Bu Tan (陳立武) is expected to meet with Taiwanese suppliers next month in conjunction with the opening of the Computex Taipei trade show, supply chain sources said on Monday. The visit, the first for Tan to Taiwan since assuming his new post last month, would be aimed at enhancing Intel’s ties with suppliers in Taiwan as he attempts to help turn around the struggling US chipmaker, the sources said. Tan is to hold a banquet to celebrate Intel’s 40-year presence in Taiwan before Computex opens on May 20 and invite dozens of Taiwanese suppliers to exchange views
Application-specific integrated circuit designer Faraday Technology Corp (智原) yesterday said that although revenue this quarter would decline 30 percent from last quarter, it retained its full-year forecast of revenue growth of 100 percent. The company attributed the quarterly drop to a slowdown in customers’ production of chips using Faraday’s advanced packaging technology. The company is still confident about its revenue growth this year, given its strong “design-win” — or the projects it won to help customers design their chips, Faraday president Steve Wang (王國雍) told an online earnings conference. “The design-win this year is better than we expected. We believe we will win
Quanta Computer Inc (廣達) chairman Barry Lam (林百里) is expected to share his views about the artificial intelligence (AI) industry’s prospects during his speech at the company’s 37th anniversary ceremony, as AI servers have become a new growth engine for the equipment manufacturing service provider. Lam’s speech is much anticipated, as Quanta has risen as one of the world’s major AI server suppliers. The company reported a 30 percent year-on-year growth in consolidated revenue to NT$1.41 trillion (US$43.35 billion) last year, thanks to fast-growing demand for servers, especially those with AI capabilities. The company told investors in November last year that
Power supply and electronic components maker Delta Electronics Inc (台達電) yesterday said it plans to ship its new 1 megawatt charging systems for electric trucks and buses in the first half of next year at the earliest. The new charging piles, which deliver up to 1 megawatt of charging power, are designed for heavy-duty electric vehicles, and support a maximum current of 1,500 amperes and output of 1,250 volts, Delta said in a news release. “If everything goes smoothly, we could begin shipping those new charging systems as early as in the first half of next year,” a company official said. The new
RSS