Local market ends higher on mild rebound of technical shares, electronics remain low
June 25, 2014, 12:01 am TWN
TAIPEI, Taiwan -- Shares in Taiwan staged a mild technical rebound Tuesday as buying rotated to the old economy sector, which had underperformed the broader market for some time, dealers said.
The bellwether electronics sector remained in the doldrums as investors decided to pocket gains built up in select heavyweights, such as smartphone camera lens supplier Largan Precision Co. (大立光電) and metal casing maker Catcher Technology Co. (可成科技) they said.
The two Taiwan-based companies are both key suppliers of Apple Inc.
Hon Hai Leads Electonics Sector
But another Apple supplier, Hon Hai Precision Industry Co. (鴻海精密), outperformed the electronics sector as investors hoped the company would come up with positive leads at its annual shareholders' meeting on Wednesday, dealers said.
The weighted index on the Taiwan Stock Exchange closed up 17.85 points, or 0.19 percent, at 9,246.20 after moving between 9,232.35 and 9,276.24, on turnover of NT$88.67 billion (US$2.96 billion).
The market opened up 4 points and rose to the day's high as bargain hunters took advantage of a decline in the index a session earlier and focused their buying on select stocks in the old economy sector, dealers said.
With the index moving closer to the nearest technical resistance at around 9,300 points, investors turned cautious and cut their holdings, in particular of some electronics shares, to limit the market's gains at the close, they said.
"It seems that the 9,300-point mark has become a ceiling for the local index for the moment after a recent strong showing. Judging from today's movement, I think many investors are reluctant to chase prices and push the index higher," Mega International Investment Services Corp. analyst Alex Huang said.
Huang said the electronics sector was the main victim of the selling, with Largan down 2.00 percent to close at NT$2,210.00 after the stock hit a record high a session earlier.
Apple Mum On Suppliers
Catcher fell 5.76 percent to end at NT$262.00 as investors were scared off by market speculation that its metal casings to be used in the next generation of iPhones had failed to obtain certification from Apple, possibly resulting in delays to its shipments.
In response to the speculation, Catcher said projects related to smartphone casing production are progressing, but it did not specify any of its customers.