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Taiwan shares end little changed

2019/03/19 17:27:53

Taipei, March 19 (CNA) Shares in Taiwan closed little changed Tuesday as market sentiment turned cautious ahead of the two-day policymaking meeting scheduled by the U.S. Federal Reserve for later in the day, dealers said.

While the bellwether electronics sector took a pause after a strong showing on Monday, bargain hunters continued to pick up financial stocks, helping to stabilize the broader market throughout the session, they said.

The weighted index on the Taiwan Stock Exchange (TWSE) or the Taiex ended down 0.38 points at 10,512.32, after moving between 10,484.69 and 10,525.60, on turnover of NT$114.69 billion (US$3.72 billion).

The market opened down 0.15 percent on a technical correction from a session earlier, when the Taiex ended up 0.70 percent, as investors shrugged off mild gains posted on U.S. markets, where the Dow Jones Industrial Average closed up 0.25 percent and the tech-heavy Nasdaq index ended up 0.34 percent overnight, dealers said.

The local main board continued to move in a narrow range as the financial sector attracted bargain hunting to move higher, offsetting selling in other sectors and preventing the Taiex from falling further by the end of the session, they said.

"After the Taiex closed above the 10,500 point mark yesterday, the main board has been faced with strong technical resistance so it was not surprising share prices generally moved in a narrow range today," Concord Securities analyst Kerry Huang said.

"Caution dominated today's market as investors preferred to stay on the sidelines ahead of the conclusion of the Fed's policymaking meeting," Huang added.

Huang said the market widely anticipates the U.S. central bank will not adjust its key interest rates at the meeting, but many investors are watching closely to see whether the Fed will indicate an end to the downsizing of its balance sheet by stopping the disposal of the bonds it owns.

"The financial sector served as an anchor to stabilize the broader market as the sector had lagged behind the bellwether electronics sector as well as the broader market for some time," Huang said. "The buying also reflected optimism over the sector's bottom line."

In the financial sector, which closed up 0.62 percent, Fubon Financial Holding Co. rose 2.07 percent to end at NT$46.95, Cathay Financial Holding Co. added 1.86 percent to close at NT$46.65 percent and E. Sun Financial Holding Co. gained 0.87 percent to end at NT$25.30.

Huang said the electronics sector saw a stagnant performance, rising only 0.07 percent.

Contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC), the most heavily weighted stock on the local market, fell 0.21 percent to close at NT$240.50 and integrated circuit designer MediaTek Inc. lost 0.90 percent to end at NT$275.50, while shares in iPhone assembler Hon Hai Precision Industry Co. rose 0.42 percent to close at NT$72.30, and smartphone camera lens supplier Largan Precision Co. rose 1.07 percent to end at NT$4,720.00.

Old economy stocks were also mixed, with Taiwan Cement Corp. up 0.79 percent to close at NT$38.10, and Asia Cement Corp. up 0.93 percent to end at NT$38.00, but Formosa Plastics Corp. down 0.47 percent to close at NT$106.00.

"In addition to the Fed's policymaking meeting, investors also need to keep a close eye on whether, when and how Washington and Beijing conclude their talks to resolve trade disputes, which is expected to move global financial markets," Huang said.

According to the TWSE, foreign institutional investors bought a net NT$1.34 billion worth of shares on the main board Tuesday.

(By Frances Huang)