Taiwan shares end slightly up as old economy losses offset tech gains

Taipei, Oct. 9 (CNA) Shares in Taiwan closed slightly higher Wednesday on a mild technical rebound from a session earlier, with buying sparked by a rally on U.S. markets overnight, dealers said.

Encouraged by the gains posted by U.S. tech stocks on Tuesday, investors picked up large cap electronics stocks involved in artificial intelligence, while non-tech stocks came under pressure, dealers said.

The Taiex, the Taiwan Stock Exchange's benchmark weighted index, ended up 47.69 points, or 0.21 percent, at 22,659.08, after moving between 22,637.17 and 22,885.95. Turnover totaled NT$407.05 billion (US$12.66 billion).

The Taiex opened 25.78 points higher but soared 226.87 points to hit the day's high within minutes, led by large cap electronics stocks.

The sudden surge was driven by a 1.45 percent increase on the tech-heavy Nasdaq index and a 1.33 percent rise on the Philadelphia Semiconductor Index overnight, dealers said.

Selling soon emerged, however, focused especially on non-tech stocks in raw material sectors amid worries over fragile demand from China, capping the upturn on the broader market by the end of the session, dealers said.

"The electronics sector, again, served as an anchor for a higher Taiex as turnover generated by tech stocks as a whole accounted for about 70 percent of the total," Moore Securities Investment Consulting analyst Adam Lin said.

"Boosted by a strong showing made by Nvidia, TSMC [Taiwan Semiconductor Manufacturing Co.] continued to move higher to above the NT$1,000 mark despite some profit taking," Lin said.

"Investors remained upbeat about AI development, expecting TSMC to give positive leads at an investor conference next week."

With Nvidia shares gaining 4.05 percent in the United States overnight, TSMC, the most heavily weighted stock in the local market, rose 0.99 percent to close at NT$1,020.00 after hitting a new high of NT$1,035.00.

"Investors were also expecting TSMC would release strong sales data for the third quarter today," Lin said.

After the market closed, TSMC reported consolidated sales in the July-September period of NT$759.69 billion, a quarterly high that beat an estimated range between NT$728 billion and NT$754 billion.

TSMC's gains contributed about 80 points to the Taiex's rise and contributed to a 0.78 percent rise in the electronics index and a 0.88 percent increase in the semiconductor sub-index.

Among other semiconductor-related stocks, IC packaging and testing services provider ASE Technology Holding Co. rose 0.65 percent to end at NT$154.00, while Scientech Corp., TSMC's IC assembly equipment supplier, lost 1.48 percent to close at NT$498.50.

"Other tech heavyweights also attracted interest, giving an additional boost to the Taiex," Lin said.

IPhone assembler Hon Hai Precision Industry Co. rose 2.58 percent to end at NT$199.00 after it said at its annual Tech Day event that it is building the world's largest production base for GB200 AI servers, powered by Nvidia's Blackwell GPU, in Mexico.

Smartphone IC designer MediaTek Inc. gained 1.63 percent to close at NT$1,245.00 after the company unveiled its next-generation Dimensity 9400 chipset.

Bucking the upturn, Largan Precision Co., a supplier of smartphone camera lenses to Apple Inc., fell 1.41 percent to end at NT$2,440.00, flat panel maker AUO Corp. dropped 0.90 percent to close at NT$16.60, and power management solution provider Delta Electronics Inc. ended down 0.13 percent at NT$381.50.

"Raw material stocks underperformed their tech counterparts as investors feared a weakening China economy would continue to affect demand," Lin said. "Their weakness prevented the Taiex from rising further."

In the steel sector, which lost 2.79 percent, China Steel Corp., the largest steel maker in Taiwan, shed 4.22 percent to close at NT$22.70, and Tung Ho Steel Corp. dropped 1.68 percent to end at NT$77.20.

In addition, Chung Hung Steel Corp. shed 5.09 percent to close at NT$20.50, and China Steel Structure Corp. ended down 1.12 percent at NT$52.90.

The petrochemical sector fell 1.95 percent after a more than 4 percent decline in international crude oil prices overnight.

Formosa Petrochemical Corp. shed 3.51 percent to close at NT$52.30, Formosa Plastics Corp. lost 2.46 percent to end at NT$49.55, Nan Ya Plastics Corp. dropped 2.35 percent to close at NT$43.60, and Formosa Chemicals & Fibre Corp. fell 2.02 percent to end at NT$41.25.

The transportation industry lost 1.87 percent, with Evergreen Marine Corp., the largest container cargo shipper in Taiwan, closing 2.91 percent lower at NT$183.50.

Rivals Yang Ming Marine Transport Corp. and Wan Hai Lines Ltd. fell 1.57 percent and 2.92 percent, respectively, to end at NT$62.50 and NT$83.00.

In the financial sector, which lost 0.50 percent, Shin Kong Financial Holding Co. fell 1.24 percent to close at NT$11.95 and Taishin Financial Holding Co. dropped 0.55 precent to end at NT$18.10, after shareholders of the two companies approved a merger plan Wednesday morning.

Fubon Financial Holding Co. lost 0.88 percent to close at NT$90.60, but Cathay Financial Holding Co. gained 0.15 percent to end at NT$67.80.

"Investors should follow closely the earnings seasons in Taiwan and the U.S., with the results of tech giants likely to move the markets," Lin said.

"With TSMC trading above the NT$1,000 mark, the Taiex could see a wider range of fluctuations based on changes in stock's price."

According to the Taiwan Stock Exchange, foreign institutional investors bought a net NT$13.30 billion in shares on the market Wednesday.