Taiwan shares edge down after TSMC recoups losses

Taipei, May 23 (CNA) Shares in Taiwan closed slightly lower Friday as contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC) recovered earlier losses, while cautious market sentiment persisted amid a spike in U.S. Treasury yields and concerns over rising debt in the world's largest economy, dealers said.

The Taiex, the weighted index on the Taiwan Stock Exchange (TWSE), ended down 18.72 points, or 0.09 percent, at 21,652.24 after moving between 21,559.78 and 21,798.88. Turnover totaled NT$307.50 billion (US$10.25 billion).

"Initial gains on the local main board prompted investors to lock in profits, pushing the Taiex into negative territory," said MasterLink Securities analyst Tom Tang.

"Concerns over mounting U.S. debt and the recent passage of President Donald Trump's sweeping tax bill by the House of Representatives led to a spike in Treasury yields, which held investors back from chasing prices," he said.

"Fortunately, TSMC regained its footing in late trading, helping the Taiex recover most of its earlier losses," Tang said. "In a session with low turnover like today, buying into TSMC made it easy to lift the entire market."

TSMC, the most heavily weighted stock, rose 0.20 percent to close at NT$984.00, off a low of NT$975.00. TSMC's recovery from its low boosted the index by more than 70 percent.

However, a spike in U.S. treasury yields still made other semiconductor stocks less attractive, Tang said.

Among them, United Microelectronics Corp., a smaller contract chipmaker, lost 2.83 percent to end at NT$48.05, IC packaging and testing services provider ASE Technology Holding Co. dropped 1.72 percent to close at NT$142.50, and smartphone IC designer MediaTek Inc. ended down 0.75 percent at NT$1,315.00.

Also in the tech sector, artificial intelligence maker Quanta Computer Inc. lost 1.31 percent to close at NT$264.00, and cloud-enabled services supplier Wiwynn Corp. dropped 2.56 precent to end at NT$2,280.00.

Bucking the downturn, iPhone assembler and AI maker Hon Hai Precision Industry Co. gained 0.65 percent to close at NT$154.00.

In addition to TSMC, "another bright side in the market was the financial sector, which was driven by an increase in cash dividend payouts," Tang said.

In the financial sector, which rose 0.34 percent, Mega Financial Holding Co. rose 1.62 percent to end at NT$40.65 and KGI Financial Holding Co. gained 1.44 percent to close at NT$17.65, while Fubon Financial Holding Co. ended down 0.49 percent at NT$81.50.

Old economy stocks appeared mixed amid concerns over volatility in the U.S. markets due to rising debt, Tang said.

After a recent strong showing, Evergreen Marine Corp., the largest container cargo shipper in Taiwan, fell 1.54 percent to close at NT$256.00 and rival Yang Ming Marine Transport Corp. shed 3.68 percent to end at NT$83.70.

Meanwhile, textile brand Far Eastern New Century Corp. rose 0.31 percent to close at NT$32.00, and Eclat Textile Co. gained 0.24 percent to end at NT$414.50.

"I expect the Taiex will continue to move in consolidation as many investors have kept watch over a possible tariff on semiconductors by the Trump administration," Tang said.

According to the TWSE, foreign institutional investors sold a net NT$3.03 billion worth of shares on the main board Friday.