after gains in previous sessions rein in betting
CNATAIPEI--Shares in Taiwan closed little changed Monday, falling into consolidation mode after having posted significant gains over the previous six sessions.
December 3, 2013, 12:08 am TWN
While many large-cap stocks, including Taiwan Semiconductor Manufacturing Co. (TSMC, 台積電) and select old economy shares, were stuck in the doldrums, Apple Inc. supplier Hon Hai Precision Industry Co. lent some support to the broader market on strong retail sales on Black Friday in the United States.
The weighted index ended up 7.78 points, or 0.09 percent, at 8,414.61, after moving between 8,391.82 and 8,437.13, on turnover of NT$67.72 billion (US$2.29 billion).
The market opened 0.27 percent higher on follow-through buying from a session earlier and moved to the day's high before profit-taking emerged to offset the early gains by the end of the session, dealers said.
“Before Monday, the local market had posted gains for six sessions in a row. It was no surprise that the momentum faded today,” President Securities analyst Vickie Hsieh said.
The weighted index had risen 307.38 points, or almost 3.8 percent, in the six previous sessions as foreign institutional investors targeted bargains by picking up market heavyweights.
“Judging from today's reduced turnover, I think many investors worried the local market would make a major pullback and were reluctant to chase share prices for the time being,” Hsieh said.
Market Sentiment Turns Upbeat in December
Hsieh believed, however, that the market's consolidation could be short-lived.
“The market remains awash in liquidity. In addition, conglomerates are likely to buy into their own shares in a bid to dress up their books as the year comes to an end. I'm upbeat about the market's performance in December," Hsieh said.
Among the large-cap stocks that faced some downward pressure, TSMC, the world's largest contract chip maker, fell 0.48 percent to close at NT$104.50, while integrated circuit designer MediaTek Inc. (聯發科) shed 1.38 percent to end at NT$430.00.
Led by TSMC, the semiconductor sub-index ended down 0.29 percent amid lingering concerns over slow season effects in the fourth quarter of this year and the first quarter of next year, Hsieh said.
In the old economy sector, Taiwan Cement Corp. (台灣水泥) lost 1.07 percent to close at NT$46.35, while Yulon Nissan Motor Co. (裕日汽車) shed 1.50 percent to end at NT$93.00.
But Hon Hai (鴻海精密) and some other local manufacturers in the Apple supply chain moved higher after online sales of electronics goods on Black Friday reportedly rose 15 percent from a year earlier to US$1.2 billion, dealers said.