Taiwan shares end down as TSMC comes under pressure

Taipei, Jan. 7 (CNA) Shares in Taiwan closed lower Wednesday as contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC) pulled back on profit taking after hitting a record closing level a session earlier, dealers said.

The Taiex, the Taiwan Stock Exchange's benchmark index, ended down 140.83 points, or 0.46 percent, at 30,435.47, after moving between 30,306.16 and 30,570.26. Turnover totaled NT$853.01 billion (US$27.08 billion).

"Ignoring the gains posted on U.S. markets overnight, local investors rushed to pocket profits built over the past few sessions, in particular from TSMC (Taiwan Semiconductor Manufacturing Co.), which led the Taiex to top the historical 30,000-point mark," Cathay Futures Consultant analyst Tsai Ming-han said.

Before Wednesday, the Taiex had soared 1,612.70 points, or 5.57 percent in the first three sessions of this year with TSMC, which accounts for over 40 percent of total turnover, surging about 10 percent.

TSMC fell 1.76 percent to close at NT$1,675.00 on Wednesday, contributing about 230 points to the Taiex's fall. Without TSMC, the Taiex would have reported gains.

"With a weakening TSMC, investors diverted their funds to other tech stocks, lending some support to the broader market," Tsai said.

Shares in United Microelectronics Corp., a smaller contract chipmaker, jumped 10 percent, the maximum daily increase, to end at NT$54.10, and AI server maker and iPhone assembler Hon Hai Precision Industry Co. closed up 1.06 percent at NT$238.50.

Memory chip suppliers continued to attract strong buying on a product price spike with Macronix International Co. soaring 10 percent to end at NT$57.60 and Nanya Technology Corp. rising 5.47 percent to close at NT$241.00, Tsai said.

In the nontech sector," raw material stocks also benefited from rotational buying on their low valuations, outperforming their tech counterparts," Tsai added.

Nan Ya Plastics Corp., the parent company of Nanya Technology, jumped 10 percent to close at NT$64.70 and Formosa Plastics Corp. gained 6.41 percent to end at NT$40.65.

China Steel Corp., the largest steel maker in Taiwan, rose 5.14 percent to close at NT$19.45, and Tung Ho Steel Corp. added 2.14 percent to end at NT$66.70.

In the financial sector, which lost 0.55 percent, Cathay Financial Holding Co. fell 0.53 percent to close at NT$75.60, and Fubon Financial Holding Co. ended down 0.31 percent at NT$96.10.

"Investors should pay attention to how TSMC's ADRs (American depositary receipts) perform tonight, which could move its common shares in Taipei and the Taiex tomorrow," Tsai said.

According to the TWSE, foreign institutional investors sold a net NT$29.87 billion worth of shares on the main board Wednesday.