Taipei, Dec. 11 (CNA) Shares in Taiwan extended their momentum from a session earlier on Monday as investors picked up large cap electronics stocks that have been hard hit in recent sessions due to a sell-off by foreign institutional investors, dealers said.
"Apple concept stocks" were in the spotlight after a strong November sales report from iPhone assembler Hon Hai Precision Industry Co. created buying momentum, while the non-high-tech sector, including financial stocks, was generally sluggish, they said.
Despite the gains, the market's benchmark index still ended below the 10,500-point mark as many investors remained reluctant to chase prices before several major central banks, including the U.S. Federal Reserve, hold policymaking meetings later in the week, they said.
The weighted index on the Taiwan Stock Exchange closed up 74.47 points, or 0.72 percent, at 10,473.09, after moving between 10,438.33 and 10,504.67, on turnover of NT$116.45 billion (US$3.88 billion).
The market opened up 0.38 percent on follow-through buying from a session earlier and increases of about half a percent in the Dow Jones Industrial Average and the S&P 500 index on Friday, dealers said.
Buying in the bellwether electronics sector ensued, led by Hon Hai, which left its recent doldrums behind after reporting a more than 17 percent month-on-month increase in sales in November.
The sales numbers gave investors optimism about shipments of the premium iPhone X, dealers said.
"Hon Hai's November sales dismissed earlier market worries about the iPhone X. The stock had been hammered by fears of slow iPhone X demand, and that's why investors returned to the buy side today," equity market analyst Vickie Hsieh said.
But once the weighted index breached 10,500, some investors decided to lock in their gains, and the selling continued to the end of the session.
"After recent heavy losses, market sentiment has turned cautious about the market's future movement," Hsieh said.
"So even though share prices staged a technical rebound today, buying was not strong enough to help the weighted index overcome technical resistance ahead of 10,500 points."
Hsieh said the broader market was able to remain above the previous closing level throughout the session because of bargain hunting in the electronics sector, which ended up 1.02 percent.
Hon Hai gained 2.56 percent to close at NT$96.00, with 72.54 million shares changing hands.
Smartphone camera lens vendor Largan Precision Co. and metal casing maker Catcher Technology Co., which are both key Apple suppliers, were lifted higher by the Hon Hai numbers.
Largan closed 1.37 percent higher at NT$4,430.00, and Catcher added 2.88 percent to end at NT$322.00.
In the non-high-tech sector, food brand Uni-President Enterprises Corp. fell 0.92 percent to close at NT$64.50, Formosa Chemicals & Fibre Corp. lost 0.64 percent to end at NT$93.80, Fubon Financial Holding Co. ended unchanged at NT$52.20, and Mega Financial Holding Co. rose 0.64 percent at NT$23.50.
"Investors are watching closely whether some of the major central banks will adjust their monetary policies, which would affect market liquidity," Hsieh said.
"While the market has widely anticipated the Fed will raise its key interest rates, its comments after the meeting is expected to hint at how the U.S. central bank will deal with interest rates next year," she said.
(By Frances Huang)
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