TAIPEI–Shares in Taiwan closed lower Wednesday as investors locked in profits they had built up a session earlier amid cautious sentiment ahead of the release of the latest policymaking meeting minutes by the U.S. Federal Reserve, dealers said.
While selling focused on old economy stocks, in particular in the petrochemical sector, due to a slide in international crude oil prices, the bellwether electronics sector appeared resilient, as several heavyweights held themselves well above the previous closing levels, the dealers said.
The weighted index on the Taiwan Stock Exchange closed down 31.46 points, or 0.32 percent, at 9,685.31, after moving between 9,662.86 and 9,736.09, on turnover of NT$97.63 billion (US$3.20 billion).
The market opened up 0.15 percent on follow-through buying from a session earlier, but with the index hitting the day’s high, selling set in to drag down the broader market and the weakness continued into the end of the session, the dealers said.
��Although the Dow Jones Industrial Average hit another record high overnight, its gains were limited, as many investors were awaiting the release of the Fed’s meeting minutes,�� Mega International Investment Services Corp. analyst Alex Huang said. ��Such caution was also seen in the local market today.��
The Fed was scheduled to release the minutes of the April 28-29 meeting later in the day.
��The minutes are expected to provide the market with more clues about what the Fed will do about its monetary policy and when the U.S. central bank will kick off an interest rate hike cycle,�� Huang said. Petrochemical Sector The petrochemical sector closed down 1.09 percent after international crude oil prices fell more than 3 percent overnight amid concerns over a supply glut.
Among the falling petrochemical stocks, Nanya Plastics Corp. (�n�ȶ�) fell 2.16 percent to close at NT$72.50 and Formosa Petrochemical Corp. (�x��) lost 1.62 percent to end at NT$78.80. The electronics sub-index closed down only 0.06 percent, outperforming the broader market. ��High tech stocks had consolidated for some time and that’s why selling pressure in the sector appeared relatively light today and some bargain hunters even targeted good buys,�� Huang said.
Integrated circuit designer MediaTek Inc. (�p�o��) appeared a good buy with its share price up 1.91 percent to close at NT$399.50, while DRAM maker Nanya Technology Corp. (�n�Ȭ�) gained 4.05 percent to end at NT$64.20 on hopes that demand for mobile DRAM from China will strengthen its bottom line.
Taiwan Semiconductor Manufacturing Co. (�x�n�q), the most heavily weighted stock in the local market, closed unchanged at NT$146.50. Financial Sector In the financial sector, Fubon Financial Holding Co. (�I����) fell 0.92 percent to close at NT$64.40, while Cathay Financial Holding Co. (������) ended unchanged at NT$55.30.
��Judging from today’s fluctuations, I think that the local bourse has technical support at around 9,650 points in the short term on the back of ample liquidity,�� Huang said.