Wall St. drop reflected locally as TAIEX finishes below 7,900 points
CNATAIPEI--Shares in Taiwan closed below the 7,900-point mark Thursday as investors took cues from an overnight drop on Wall Street to cut their holdings in the local market, dealers said.
August 16, 2013, 12:02 am TWN
The bellwether electronics sector continued to come under pressure as market sentiment was hit by disappointing second-quarter results released by contract notebook maker Quanta Computer Inc., the dealers said.
The weighted index closed down 0.8 percent, at 7,887.26, after moving between 7,850.27 and 7,916.02, on turnover of NT$77.15 billion (US$2.58 billion).
The market opened down 0.61 percent in the wake of the latest losses posted on Wall Street, and selling escalated, mainly among high-tech stocks amid lingering concerns over global demand, the dealers said.
Selling spread to other sectors, with the focus on large-cap stocks, which pushed the index down further, while the broader market recouped some of its earlier losses at the end of the session, they said.
“The electronics sector continued to lead the broader market in today's fall, in particular after Quanta posted a decline in profit for the second quarter and gave a gloomy outlook for shipments for the entire 2013,” Concord Securities analyst Kerry Huang said.
Quanta fell 3.13 percent to close at NT$61.80, with 5.26 million shares changing hands, while the electronics sub-index ended down 0.69 percent.
The selling in Quanta emerged soon after the market opened as the world's largest notebook ODM services provider announced a day earlier that its second-quarter net profit fell 9.7 percent from the first quarter, and that it expects its 2013 notebook shipments to drop 18 percent from 2012.
“Quanta's results further dampened market sentiment about global demand for high-tech devices. I am not surprised by the sell-off, as many investors raised alerts over the sector's earnings outlook,” Huang said.
Among other losing notebook makers, Inventec Corp. shed 6.29 percent to close at NT$61.80, while Compal Electronics Inc. lost 1.60 percent to end at NT$18.50.