Local market retreats, but still ends above 9,200 points


TAIPEI — Shares in Taiwan fell Friday as investors took cues from lackluster performance on Wall Street overnight, but the index still ended above 9,200 points as the financial sector continued its momentum, dealers said. Buying in financial stocks reflected lingering optimism that the Legislative Yuan will revise the income tax act to lower the tax burden shouldered by major stock market players, the dealers said. The construction sector staged a technical rebound, while the bellwether electronics sector trended lower with selling focusing on large-cap high-tech stocks such as Taiwan Semiconductor Manufacturing Co. (TSMC,�x�W�n���q��), to lock in their recent gains, they added. The weighted index on the Taiwan Stock Exchange (�x�W�Ҩ�������) closed down 18.54 points, or 0.20 percent, at 9,206.57, after moving between 9,192.29 and 9,240.51 on turnover of NT$97.77 billion (US$3.14 billion). The market opened down 4.86 points in a knee-jerk reaction to a mild correction on Wall Street ahead of the release of U.S. non-farm payroll data for November, the dealers said. With the index falling below 9,200 points, bargain hunters turned active, helping the broader market recoup part of its earlier losses and pushing the index back to that level at the close, they said. Fed Calls the Shots ��The U.S. is scheduled to release the November job report later in the day, which will serve as a clue on whether the Federal Reserve (Fed) will adjust its monetary policy,�� Huang said. The Fed is scheduled to hold a policymaking meeting Dec. 16-17.

��The conclusion of the meeting could move global equity markets,�� Concord Securities analyst Kerry Huang said. ��Despite a mild pullback, the local market remained stable as many investors were betting that the Legislative Yuan (�ߪk�|) will raise the capital gains tax threshold for major stock market players or even abolish the tax,�� Huang said. ��Judging from daily turnover in the past few sessions, I suspect that some major players have been returning to the trading floor on the tax change hopes,�� Huang said. The capital gains tax, which was passed in mid-2013 and is scheduled to go into effect next year, will be imposed on investors who make trades totaling NT$1 billion or more a year. Lawmakers have proposed raising the threshold to NT$5 billion, although it is possible that the tax could be scrapped completely. On the back of an upbeat mood toward the tax scheme, the financial sector closed up 0.27 percent, outperforming the broader market. Financial Sector Outperforms Among the gaining financial stocks, CTBC Financial Holding Co. (���H����) rose 0.72 percent to close at NT$20.85, and Capital Securities gained (�s�q�Ҩ�) 2.43 percent to end at NT$10.55. The construction sector closed up 0.99 percent, bouncing back from a slump seen Thursday, with Highwealth Construction Corp. (���I�o�س]) up 1.44 percent to end at NT$63.50 and Huaku Development Co. up 4.59 percent to close at NT$63.80. ��Investors took profit among high-tech stocks after the sector posted gains in recent sessions. That’s why TSMC failed to react positively to an upbeat forecast of its sales growth,�� Huang said. The electronics sector ended down 0.59 percent. TSMC fell 1.08 percent to close at NT$137.50, although the company said a day earlier that the world’s largest contract chip-maker’s sales growth in 2015 will continue to outpace that of the global semiconductor business.