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Local market edges up after choppy session

TAIPEI--Shares in Taiwan closed slightly higher Wednesday after a choppy session in which a tug-of-war between selling and buying dominated trading, dealers said.

While Taiwan Semiconductor Manufacturing Co. (TSMC, 台積電) pulled back as investors locked in gains built up in recent sessions, interest in select high-priced electronics stocks such as metal casing supplier Catcher Technology Co. (可成科技) and smartphone vendor HTC Corp. (宏達電) lent some support to the index, the dealers said.

Buying in certain old-economy stocks, in particular in the food and textile sectors, also served as an anchor that stabilized the broader market, they added.

The weighted index on the Taiwan Stock Exchange closed up 7.11 points, or 0.07 percent, at 8,923.82 after moving between 8,894.29 and 8,968.56 on turnover of NT$94.13 billion (US$3.12 billion).

The market opened at 4.36 points and continued fluctuating around the 8,900 point mark during the trading session, the dealers said.

The index spiked in the late session to hit the day's high, but profit-taking set in to cap the gains at the end of the session, they said.

“The local market remained haunted by fears of a major technical pullback as the index breached 8,900 points and moved closer to 9,000 points, where heavy technical resistance appeared,” President Securities analyst Vickie Hsieh said.

Hsieh said that as Wall Street is in an earnings season, market sentiment remained cautious, which capped turnover in the local equity market, with many investors reluctant to trade.

Expanded Turnover Needed to Hurdle 9000 Points

In addition, before March contracts in the local futures market were set to be settled later in the day, many investors preferred to stay on the sidelines, the analyst said.

“Unless turnover expands to NT$130 billion or higher, it will be difficult for the index to clear the hurdles ahead of 9,000 points,” she said.

Among the gaining high-priced electronics stocks, Catcher rose 5.44 percent to close at NT$232.50 after Barclays Capital raised its target price on the stock to NT$300 from NT$235 amid optimism that the metal casing maker will benefit from the launch of Apple Inc.'s new version of the iPhone later this year.

HTC gained 3.26 percent to close at NT$158.50 as many investors had high hopes that the smartphone vendor will turn a profit in the second quarter on the back of its efforts to promote new models globally.

TSMC Shares Down Ahead of Conference

TSMC, however, fell 1.22 percent to end at NT$121.00 ahead of an investor conference scheduled for Thursday, when the world's largest contract chip maker will release its first-quarter results and give sales guidance for the second quarter.

“TSMC has good fundamentals. I am not worried about today's correction and expect the stock will continue to move higher,” Hsieh said.

In the non-high tech sector, food product supplier Great Wall Enterprise Co. (大成長城) rose 3.48 percent to close at NT$31.20, and textile maker Far Eastern New Century Corp. (遠東新世紀) added 0.95 to end at NT$31.85, while Cathay Financial Holding Co. (國泰金控) closed down 0.57 percent at NT$43.85.

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