Taiwan shares end up as tech sector bounces back from early losses

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TAIPEI (CNA) — Shares in Taiwan closed slightly higher Thursday, as the bellwether electronics sector recovered from its early losses, helping to push the broader market into positive territory, dealers said.

The biotech sector continued its momentum from the previous session, amid fears over a second wave of COVID-19 infections, as the number of confirmed cases in the United States and China spiked, dealers said.

The weighted index ended up 13.74 points, or 0.12 percent, at 11,548.33, after moving between 11,485.39 and 11,567.42. Turnover totaled NT$182.48 billion (US$6.16 billion) during the session.

The market opened down 0.39 points in a knee-jerk reaction to a mixed performance on the U.S. markets overnight but soon recovered and moved to the day’s high in the early morning session, dealers said.

As some investors shifted to the sell side, however, and with the Taiex moving closer to 11,600 points, some tech stocks fell, dragging the main board into negative territory.

Eventually, buying reemerged, focusing on select large cap electronics stocks, which helped push the market above its closing level the previous day, dealers added.

“Global financial stocks remained volatile, and that is expected to continue amid COVID-19, so it was no surprise that the local equity market also remained bothered,” Taishin Securities Investment Advisory analyst Tony Huang said.

He said the Taiex, however, remained awash in liquidity as foreign funds continued to enter the region.

“The Taiex appeared resilient, with investors willing to park their funds there, which sparked rotational buying,” Huang said, referring to a rebound in the afternoon session by the electronics sector, which rose 0.41 percent, off a low of 509.06 points, to close at 512.94.

Contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC), the most heavily weighted stock on the local market, gained 0.64 percent to end at NT$314.50 after hitting a low of NT$313.00.

iPhone assembler Hon Hai Precision Industry Co. rose 0.38 percent to close at NT$78.50, off a low of NT$77.70, and integrated circuit designer MediaTek Inc. climbed 0.59 percent to finish at NT$513.00, off a low of NT$508.00.

The upturn did not extend to smartphone camera lens supplier Largan Precision Co., which fell 2.64 percent to end at NT$4,050.00 amid concerns over its third-quarter outlook.

“Biotech stocks attracted more buying today and helped drive the gains on the Taiex, as investors expect that sector to continue to benefit amid the COVID-19 pandemic,” Huang said.

Among those stocks, China Chemical & Pharmaceutical Co. and Sinphar Pharmaceutical Co. soared by the maximum daily 10 percent to close at NT$26.60 and NT$30.90, respectively.

Old economy stocks, meanwhile, were mixed, with China Steel Corp., the largest steel maker in Taiwan, falling 1.91 percent to close at NT$20.55 and Eclat Textile Co. gaining 0.57 percent to end at NT$350.00.

“In addition to keeping an eye on the pandemic, investors need to pay attention to the geopolitical situation, as the tensions on the Korean Peninsula and conflict between China and India are likely to move equity prices worldwide,” Huang said.

According to Taiex data, foreign institutional investors bought a net NT$2.25 billion worth of shares on the main board Thursday.