Taiwan shares end down in consolidation after recent solid gains

Taipei, March 25 (CNA)

Shares in Taiwan closed slightly lower Monday, falling back after hitting an all-time closing high last week, dealers said.

The electronics sector, which had driven the recent gains, comes under pressure, while selecting old economy stocks, in particular in the electrical machinery and transportation industries, attracted buying, lending support to the broader market, dealers said.

The Taiex, the Taiwan Stock Exchange’s benchmark weighted index, ended down 36.18 points, or 0.18 percent, at 20,192.25 after moving between 20,172.80 and 20,285.38. Turnover totaled NT$369.93 billion (US$11.61 billion).

The market opened up 0.21 points but moved in a narrow range for the rest of the trading session, hurt by downward pressure on large cap tech stocks, including contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC), dealers said.

“After the Taiex hit a closing high in consecutive sessions last week, investors were more cautious, worried about a possible technical pullback,” Cathay Futures Consultant analyst Tsai Ming-han said.

On Friday, the Taiex ended at a record high of 20,228.43 after reaching an intraday high of 20,296.10, as investors responded positively to US Federal Reserve comments that it intended to cut its key interest rates three times this year.

Still, tech stocks lost ground. TSMC, the most heavily weighted stock in the local market, lost 0.64 percent to close at NT$780.00, pulling down the Taiex by more than 40 points.

It also sends the electronics index and semiconductor sub-index down by 0.51 percent and 0.61 percent, respectively.

Among other semiconductor stocks, dynamic random access memory (DRAM) chip supplier Nanya Technology Corp. dropped 1.58 percent to close at NT$68.50, and United Microelectronics Corp., a smaller contract chipmaker, lost 1.15 percent to close at NT$51.80.

IC packaging and testing services provider ASE Technology Holding Co. ended down 0.94 percent at NT$157.50, and smartphone IC designer MediaTek Inc. lost 0.44 percent to close at NT$1,120.00.

Alchip Technologies, Inc., an application specific integrated circuit (ASIC) designer, bucked the downturn, closing 0.29 percent higher to end at NT$3,460.00.

Though US-based AI chip designer Nvidia Corp. hit another new high Friday, Tsai said, AI server maker Quanta Computer Inc. lost 0.97 percent to close at NT$255.00 in Taiwan, and rival Wistron Corp. fell 0.81 percent to end at NT$122.00.

Meanwhile, Wistron’s cloud application subsidiary, Wiwynn Corp., lost 1.31 percent to close at NT$2,265.00, and LITE-ON Technology Corp., a maker of power management solutions for AI server use, shed 2.06 percent to end at NT$119.00.

“When funds in the tech sector were squeezed, investors simply parked their money in select old economy stocks,” Tsai said, referring to gains by electrical machinery makers.

With the electrical machinery index rising 4.99 percent, Fortune Electric Co. soared 10 percent, the maximum daily increase, to close at NT$785.00, and Shihlin Electric & Engineering Corp. surged 9.12 percent to end at NT$299.00.

The transportation industry rose 0.87 percent amid an ongoing crisis in the Middle East, with Evergreen Marine Corp., the largest container cargo shipper in Taiwan, closing 2.06 percent higher at NT$173.50, and rival Yang Ming Marine Transport Corp. up 1.00 percent to end at NT$45.60.

In the financial sector, which lost 0.31 percent, Fubon Financial Holding Co. dropped 0.86 percent to close at NT$69.00, and Cathay Financial Holding Co. ended down 0.93 percent at NT$48.10.

“I think the Taiex will continue to see strong technical support at around 20,000 points in the near term, with enthusiasm toward AI applications expected to prompt investors to resume buying tech stocks,” Tsai said.

“In the longer run, we’ll have to see if foreign institutional investors move large funds into the local market to sustain the gains,” Tsai said.

According to the Taiwan Stock Exchange, foreign institutional investors sold a net NT$9.12 billion in shares on the market Monday.