Local bourse ends lower, bargain hunting limits losses
The China Post news staff and CNA
October 25, 2012, 11:00 am TWN
Shares on the Taiwan Stock Exchange closed lower yesterday amid lingering concerns over weakness in the world's economic fundamentals, dealers said.
The local bourse, however, recovered part of its earlier losses by the end of the session as bargain hunters picked up select large-cap stocks in the high-tech and old economy sectors to take advantage of their cheap valuations after a recent slump, they said.
The weighted index closed down 22.60 points, or 0.30 percent, at 7,314.88, after moving between 7,274.88 and 7,348.45, on turnover of NT$57.37 billion.
Stabilization Fund Gains
Meanwhile, Chang Sheng-ho, Minister of Finance, yesterday still refused to say whether the government's National Stabilization Fund has entered the market.
According to data, the fund had entered the market two times over the past four years, one in 2008 and one in 2011. Each time the fund gained more than 20 percent.
Yesterday, the market opened down 0.67 percent and moved to the day's low after investors took cues from a plunge on Wall Street, which fell to a seven-week low due to worse-than-expected corporate earnings, dealers said.
After the index fell below the 7,300 point mark, bargain hunting emerged to help the market recoup part of its earlier losses by the end of the trading session, they said.
"Judging from the gains posted by certain market heavyweights, I suspect the buying came from the government in a bid to prevent the index from falling below 7,300 points," Mirae Asset Management analyst Arch Shih said.
Among the winning electronics stocks, Hon Hai Precision Industry Co., the world's largest contract electronics maker, rose 0.35 percent to close at NT$85.00, off an early low of NT$83.50, while smartphone vendor HTC Corp. gained 2.13 percent to end at NT$263.50.
In the old economy sector, Taiwan Cement added 0.13 percent to close at NT$37.65, and Yulon Motor Co. rose 0.55 percent to end at NT$54.80.