Local market stages mild technical rebound Tues.
January 8, 2014, 12:29 am TWN
TAIPEI, Taiwan -- Shares in Taiwan staged a technical rebound Tuesday alongside regional equity markets like those in Seoul and Singapore from weak performance across Asia seen Monday, dealers said.
The upturn in the local bourse, however, was limited as foreign institutional investors remained cautious about the market outlook, building up a large number of short-position contracts in the futures market, they said.
The weighted index of the Taiwan Stock Exchange closed up 12.29 points, or 0.14 percent, at 8,512.30 off an early high of 8,547.19, on turnover of NT$95.65 billion (US$3.19 billion).
Grand Fortune analyst Chen Wei-tai said that foreign institutional investors have built up more than 5,800 short-position contracts in the futures market, indicating they have turned very cautious about the outlook of the spot market.
“Many foreign investors have feared that Wall Street could suffer a major pullback any time after it has repeatedly hit fresh highs, so they have become reluctant to buy into local market heavyweights for the time being,” Chen said.
“As long as large cap stocks, especially those in the electronics sector, remained in the doldrums, it was not easy for the broader market to make a significant comeback,” Chen said.