Taiwan shares end down after a wild swing

Taipei, June 5 (CNA) Shares in Taiwan closed lower Friday after a volatile session as sentiment was hurt by heavy losses among tech stocks in the United States overnight, but financial stocks helped stabilize the market, dealers said.

The Taiex, the Taiwan Stock Exchange's benchmark index, ended down 606.52 points, or 1.33 percent, at 45,070.94 after moving between 44,209.53 and 45,619.82, an unusually wide 1,400-point swing.

Turnover totaled NT$1.23 trillion (US$38.70 billion).

"Today's volatility came as many investors rushed to pocket recent gains built in the electronics sector in the wake of the U.S. losses," Hua Nan Securities analyst Kevin Su said, citing a 2.15 percent fall on the Philadelphia semiconductor index on Thursday.

"The Taiex has been largely boosted by AI-related stocks, led by contract chipmaker TSMC (Taiwan Semiconductor Manufacturing Co.)," Su said, "Now, investors appeared to turn cautious about a possible major pullback."

TSMC, which accounts for over 40 percent of total market value, lost 0.84 percent to close at NT$2,365.00, but the losses were capped as its American depositary receipts rose 1.88 percent overnight.

"TSMC came off the day's low as bargain hunters still favored the stock's sound fundamentals," Su said.

Smartphone IC designer MediaTek Inc. fell 2.93 percent to end at NT$4,300.00, while memory chip stocks suffered heavier losses. After U.S.-based Micron Technologies Inc. fell 7.74 percent overnight, Winbond Electronics Corp. plunged 10 percent, the maximum daily decline, to close at NT$162.00.

Bucking the downturn, United Microelectronics Corp., a smaller contract chipmaker, rose 5.20 percent to end at NT$131.50 on a shortage of chips made of mature processes.

Other AI-related stocks also moved lower, with iPhone assembler and AI server maker Hon Hai Precision Industry Co. losing 2.90 percent to close at NT$284.50, and Quanta Computer Inc., another AI server supplier, ending down 3.34 percent at NT$390.50.

"The silver lining was that the financial sector stayed resilient as financial firms' bottom lines have been boosted by higher returns in stock market investments," Su said. "Rotational buying remained active as the market was awash in liquidity."

With the financial index up 0.79 percent, Cathay Financial Holding Co. rose 5.93 percent to close at NT$100.00, and Fubon Financial Holding Co. gained 3.51 percent to end at NT$118.00.

In the old economy sector, Formosa Plastics Corp. lost 3.74 percent to close at NT$48.90, and Nan Ya Plastics Corp. fell 5.86 percent to end at NT$104.50. Shihlin Electric & Engineering Corp. tumbled 10 percent to close at NT$241.50.

"Due to rotational buying, the Taiex still closed above the nearest technically significant level of 44,789 points, the 10-day moving average, indicating the index has not turned very fragile technically yet," Su said.

According to the Taiwan Stock Exchange, foreign institutional investors sold a net NT$82.63 billion in shares on the market Friday.