Local market recoups losses early on, still lands flat
CNATAIPEI--Shares in Taiwan recouped their early losses Wednesday to end flat after investors picked up bargains in the bellwether electronics sector, which was hit initially by the weakness of “Apple concept stocks,” dealers said.
September 12, 2013, 12:12 am TWN
Although bargain hunting commenced late in the session, the broader market remained stuck in a trading range amid cautious sentiment toward the local political climate after the ruling Kuomintang (KMT) revoked the membership of Legislative Yuan Speaker Wang Jin-pyng on accusations of improper lobbying, dealers said.
The decision is expected to render Wang ineligible to remain as a KMT lawmaker-at-large, which in turn could result in the loss of his position as head of the Legislative Yuan.
The weighted index closed up 0.22 points at 8,208.99, off an early low of 8,137.07 and a high of 8,208.99, on turnover of NT$89.33 billion (US$3 billion).
The market opened down 0.39 percent, led by the losses among local electronics makers in the Apple Inc. supply chain despite the launch of two new iPhones overnight, dealers said.
Selling escalated as the Apple concept stocks kept losing steam, while worry over the local political climate escalated, dealers said.
However, as the index moved closer to 8,100 points, bargain hunting emerged, pushing the index back into positive territory by the end of the session, they added.
“The late buying may have come from government-led funds as the authorities tried to quell investors' anxiety over the political turmoil,” Mega International Investment Service Corp. analyst Alex Huang said.
“The Wang matter could cause more ripples in local politics in the short term, but the impact is likely to fade as time goes by,” Huang said. “I am not particularly worried about the movement of the local market.”
Bargain hunters moved their funds to local Apple suppliers after these stocks took a beating as the U.S. consumer electronics giant failed to impress the market with its new iPhone 5S and iPhone 5C that are aimed at both the high- and low-end markets.