Select Apple concept stocks gain as market ends down
CNA April 25, 2014, 12:00 am TWN
TAIPEI--Shares in Taiwan suffered profit taking to close in negative territory Thursday, although certain local suppliers in the Apple Inc. supply chain posted gains in the wake of better-than-expected quarterly results from the U.S. consumer electronics giant, dealers said.
The weighted index on the Taiwan Stock Exchange closed down 11.47 points, or 0.12 percent, at 8,945.45, after moving between 8,926.55 and 8,971.94 on turnover of NT$94.92 billion (US$3.13 billion).
The market opened up 0.13 percent and rose to the day's high on a rebound from the previous day's losses, with certain Apple concept stocks in focus, the dealers said.
However, in the latter part of the session, investors rushed to lock in their earlier gains, cutting holdings in other high-tech stocks and shares in the old economy sector, which pushed the index into the red at the close, they said.
"The local market needs some time to digest pressure before it can take off to overcome the technical hurdles and close above 9,000 points," Concord Securities analyst Kerry Huang said.
"Although the local market has repeatedly failed to end above 9,000 points, I remain upbeat about the market outlook as the market is awash in liquidity," Huang said, adding that the index could find short-term technical support at around 8,900 points.
Hon Hai Closed Unchanged
Among the stagnant market heavyweights, Hon Hai Precision Industry Co. (鴻海精密), which assembles iPhones and iPads for Apple, closed unchanged at NT$88.60 and TSMC, the most heavily weighted stock in the local market, ended flat at NT$121.00.
While Largan Precision Co. (大立光電), one of Apple's suppliers of camera lenses for the iPhone, moved sharply higher on the back of Apple's earnings, large-cap stocks such as Taiwan Semiconductor Manufacturing Co. (TSMC,台積電) remained in the doldrums, the dealers said.
Outperforming the broader market, Largan rose 3.85 percent to close at NT$1,755.00, remaining the most expensive stock in the local market as investors took cues from Apple's strong quarterly results.
Catcher Technology Co. (可成科技), a metal casing supplier to Apple, gained 6.48 percent to end at NT$263.00, while printed circuit board maker Career Technology Co. added 3.31 percent to close at NT$40.55.
"However, the gains posted by these Apple suppliers were eroded as other stocks remained weak, with many investors remaining wary of a possible major pullback on the broader market," Huang said.
Old economy stocks generally came under pressure ahead of the nearest technical resistance level at around 9,000 points, they added.
Selling focused on old economy stocks, particularly firms with close business ties with China, as investors took profits from their recent gains amid concerns over the pace of China's economic growth due to the latest contraction in manufacturing activity there.
Food maker Uni-President Enterprises Corp. (統一企業) lost 0.95 percent to close at NT$52.00 and Taiwan Cement Corp. (台灣水泥) shed 0.82 percent to end at NT$48.15.
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