TAIEX falls short of 8,000 points on stiff resistance
CNATAIPEI, Taiwan -- Shares in Taiwan ends lower Wednesday with investors locking in the gains they built a day earlier as the local market encountered stiff technical resistance just short of 8,000 points, dealers said.
August 15, 2013, 12:07 am TWN
The weighted index closed down 34.94 points, or 0.43 percent, at 7,951.33, after moving between 7,926.23 and 7,981.56. Turnover was NT$77.17 billion (US$2.57 billion).
The market had opened down 0.09 percent and selling escalated to push down the index to the day's low before bargain hunting emerged to help share prices recoup part of the earlier losses at the end of the session, they said.
“It was no surprise that the local market stumbled before 8,000 points, where there are high technical hurdles,” said Mega International Investment Service Corp. analyst Alex Huang.
The electronics sector, which had pulled ahead of the broader market to gain on Tuesday, fell back under pressure facing Apple concept stocks, dealers said.
The sector closed down 0.28 percent as interest in local Apple Inc.'s local supply chain waned, one day after the stocks saw a boost from reports that the U.S. consumer electronics giant will launch new devices in September.
“I am not worried about today's losses suffered by the Apple suppliers since the retreat was quite technical in nature,” Huang said. “The presence of a new iPhone and iPad are likely to boost shipments in the quarter, which could lend support to share prices.”
Among the losses was high-end smartphone camera lens supplier Largan Precision Industry Co., which fell 1.34 percent to close at NT$1,105. The stock hit a record high of NT$1,120 just one session ago.
Huang remains confident though that Largan will report satisfactory results for the current quarter on the back of Apple's new models. The Taiwanese supplier posted an about 10 percent sequential increase in net profit in the second quarter.
Hon Hai Precision Industry Co., which assembles iPhones and iPads, closed unchanged at NT$79.10.
Selling was also seen in the old economy sector and the financial sector on a lack of fresh leads for investors to buy.
In the old economy sector, Formosa Plastics Corp. lost 0.81 percent to end at NT$73.80, and Nan Ya Plastics Corp. closed down 1.0 percent at NT$59.40.
Bucking the downtrend on the broader market, DRAM supplier Inotera Memories Inc. closed up 7 percent, the maximum daily increase, to NT$13.05, while Nanya Technology Corp. ended up 1.26 percent at NT$4.01, a product of a price hike in the spot market.
“Although the local market's gains have been stopped ahead of 8,000 points, there are few chances for the index to fall below 7,800 points any time soon,” Huang said.
“Even if the market moves closer to 7,800 points, good buying opportunities will emerge,” he said.