Gains on Taiex capped after index jumps of more than 380 points
Taipei, May 21 (CNA) The Taiex, the weighted index of the Taiwan Stock Exchange (TWSE), climbed more than 380 points at one point on Friday morning, but gains were capped amid concerns about the spread of COVID-19 in the county, dealers said.
Market sentiment remained haunted by concern over an escalation in domestic COVID-19 cases, and many investors used the index’s initial rally to lock in profits, dealers said. By 10:45 a.m., the Taiex had gained 123.09 points, or 0.77 percent, to 16,165.45, from an earlier high of 16,431.14, on revenue of $ 246.63 billion NT (8.81 billion US dollars).
The local stock market opened 0.59% following a technical rebound from a previous session, and buying accelerated quickly, with an emphasis on large-cap tech stocks, dealers said.
At the start of the session, the Taiex rose more than 380 points, following a rally in US markets, where the high-tech Nasdaq index gained 1.8% overnight, said dealers.
“As the Taiex moved closer to 16,500 points, some investors turned to sell amid concerns about the spread of COVID-19 in Taiwan,” MasterLink Securities analyst Tom Tang said. “There were some high technical hurdles before 16,500 points, so the profit taking just followed the peak.”
On Thursday, the Taiex fell 0.56% to end at 16,042.36 points, from a low of 15,943.45, as bargain hunters rushed to recover shares of contract chipmaker Taiwan Semiconductor Manufacturing. Co. (TSMC) at the end of the trading session.
“The TSMC buy continued this morning, pulling the lead board out of yesterday’s slump, before profit taking set in amid concerns about the high valuation of semiconductor stocks,” he said. Tang said.
A US brokerage firm lowered its target prices on several semiconductor stocks, including TSMC, due to their high prices.
At 10:45 am on Friday, TSMC was up 0.35% to NT $ 569.00, after hitting an earlier high of NT $ 577.00.
“TSMC could see strong technical resistance ahead of NT $ 581.00, its approximate 20-day moving average, but its fundamentals remain strong,” Tang said.
Among other semiconductor stocks, United Microelectronics Corp. rose 1.29% to NT $ 47.10, after peaking NT $ 48.20, and integrated circuit designer MediaTek Inc. climbed 3.12% to NT $ 959.00 after hitting 973 .00 NT $, at 10:45 am.
Also in the electronics sector, iPhone assembler Hon Hai Precision Industry Co. rose 2.36% to NT $ 108.50, and Largan Precision Co., a supplier of camera lenses. for smartphone to Apple Inc., was up 2.63% to NT $ 2,925.00.
Meanwhile, shipping inventories continued to gain momentum due to high freight rates amid a shortage of global freight services, Tang said.
Evergreen Marine Corp., the largest container shipping company in Taiwan, rose 5.45% to NT $ 81.20, and Yang Ming Marine Transport Corp. climbed 5.99% to NT $ 88.50.
On Friday, the shipping and airline industry accounted for 30% of total main card revenue.
“Judging from today’s move, I think the industry could generate significant revenue again,” Tang said.