Taiwan shares end sharply down after U.S. bombs Iran

Taipei, June 23 (CNA) Shares in Taiwan took a beating Monday as investor sentiment was spooked by the United States' bombing of three nuclear sites in Iran over the weekend, which raised concerns over political tensions in the Middle East, dealers said.

The Taiex, the Taiwan Stock Exchange's weighted index, ended down 313.72 points, or 1.42 percent, at 21,732.02, after moving between 21,551.58 and 21,801.32. Turnover totaled NT$307.601 billion (US$10.36 billion).

The market came under heavy pressure soon after it opened down 1.33 percent, with the sell-off seen almost across the board, amid fears the military conflict between Israel and Iran could escalate.

The weakness continued before some bargain hunters became active and picked up select tech and financial heavyweights. Still, the Taiex ended below the nearest technical support level of 21,796 points, the 20-day moving average.

"The U.S. strike complicated the conflicts in the Middle East, and the Taiex simply reacted to growing geopolitical unease today," Concord Securities analyst Kerry Huang said.

"With U.S. President Donald Trump floating the idea of regime change in Iran, there are growing fears that Washington will send ground forces to oust the current Iranian leadership, which would further exacerbate the situation," Huang said.

Fortunately, Huang said, some investors appeared willing to pick up bargains in the electronics and financial sectors to cap the downturn on the main board.

Among the tech stocks that came off their early lows, smartphone IC designer MediaTek Inc. rose 0.40 percent to close at the day's high of NT$1,255.00, and IC packaging and testing services provider ASE Technology Holding Co. gained 1.73 percent to end at the day's high of NT$147.00.

Also, iPhone assembler and artificial intelligence server maker Hon Hai Precision Industry Co. rose 0.32 percent to close at the day's high of NT$156.00.

But contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC), the most heavily weighted stock in the Taiex, shed 3.32 percent to end at NT$1,020.00, contributing about 280 points to the Taiex's fall and helping the electronics index slide 1.81 percent.

"TSMC shares underperformed and served as a driver to the Taiex's losses as Washington is reportedly considering an end of waivers that allow the chipmaker and others to send American technology to China," Huang said.

Bargain hunting was also found among financial stocks with Cathay Financial Holding Co. up 0.46 percent to close at the day's high of NT$65.90. Fubon Financial Holding Co. ended down 0.24 percent at NT$84.70 after coming off a low.

Old economy industries were mixed.

The petrochemical industry rose 0.25 percent after a spike in international crude oil prices.

Formosa Petrochemical Corp. rose 3.90 percent to close at NT$38.60, Formosa Plastics Corp. gained 1.61 percent to end at NT$34.75, and Nan Ya Plastics Corp. closed up 0.37 percent at NT$27.10, while Formosa Chemicals & Fibre Corp. ended down 0.67 percent at NT$22.30.

Universal Cement Corp. lost 1.98 percent to close at NT$29.70, and rival TCC Group Holdings Co. fell 1.57 percent to end at NT$25.10, while Shihlin Electric & Engineering Corp. rose 1.95 percent to close at NT$183.00, and Fortune Electric Co. added 1.42 percent to end at NT$572.00.

"Investors should watch to see if Iran will shut down the Strait of Hormuz as reported. Once Hormuz, where many oil ships go through, is closed, crude oil prices are likely to go up higher, adding pressure to inflation," Huang said.

According to the Taiwan Stock Exchange, foreign institutional investors sold a net NT$15.21 billion in shares on the market Monday.