Taiwan shares end down as TSMC falls to negative territory

Taipei, Dec. 17 (CNA) Shares in Taiwan closed slightly lower Tuesday as contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC) fell into negative territory, dealers said.

The weakness reflected caution ahead of a two-day policymaking meeting of the U.S. Federal Reserve scheduled to open later in the day, dealers added.

The Taiex, the weighted index on the Taiwan Stock Exchange (TWSE), ended down 21.89 points, or 0.10 percent, at the day's low of 23,018.01 after coming off a high of 23,223.51. Turnover totaled NT$399.14 billion (US$12.28 billion).

The market opened up 0.40 percent and rose to the day's high in the early morning session, up about 184 points, as the bellwether electronics sector steamed ahead in the wake of a 1.24 percent rally on the tech-heavy Nasdaq index in the United States overnight.

But TSMC, the local market's most heavily weighted stock, soon encountered profit-taking and selling escalated in the late trading session.

TSMC's eventual 0.92 percent decline to NT$1,075.00 cost the Taiex about 120 points.

"Despite the initial upturn, many investors appeared reluctant to chase prices as they stayed alert over the upcoming Fed's meeting," Hua Nan Securities analyst Kevin Su said. "They just wanted to wait for the Fed's decision and its comments on how the American central bank will carry out its rate cut cycle."

Su said while TSMC came under pressure, other semiconductor stocks, especially IC design stocks, stayed resilient.

After the U.S.-based application-specific integrated circuit (ASIC) designer Broadcom ended at a fresh high overnight, its Taiwanese counterparts also moved higher, with AIchip Technologies Inc. up 10 percent, the maximum daily increase, to close at NT$3,320.00, and TSMC's ASIC design subsidiary Global Unichip Corp. up 8.79 percent to end at NT$1,485.00.

Also in the electronics sector, iPhone assembler Hon Hai Precision Industry Co. rose 0.55 percent to close at NT$183.00, while artificial intelligence (AI) server maker Quanta Computer Inc. ended unchanged at NT$275.00.

Robotics stocks attracted strong buying to outperform the broader market in the current AI era. Among them, Apex Dynamics Inc. soared 10 percent to close at NT$68.00. and Asia Optical Co. also surged 10 percent to end at NT$144.50.

Nontech stocks appeared mixed throughout the session.

Formosa Plastics Corp. lost 0.81 percent to close at NT$36.80, and Nan Ya Plastics Corp. fell 0.60 percent to end at NT$33.00, while Fortune Electric Co. rose 1.16 percent to close at NT$524.00, and Shihlin Electric & Engineering Corp. gained 0.80 percent to end at NT$33.00.

In the financial sector, Fubon Financial Holding Co. lost 1.28 percent to close at NT$92.50, and Cathay Financial Holding Co. fell 2.14 percent to end at NT$68.60.

"In addition to the Fed's meeting, investors should keep alert over the futures settlement day tomorrow. As foreign institutional investors still own a large number of short position futures contracts, they could dump their stocks on the spot market to profit in futures," Su said.

According to the TWSE, foreign institutional investors bought a net NT$3.43 billion worth of shares on the main board Tuesday.