Taiwanese shares took a beating yesterday as the benchmark TAIEX fell to its lowest point in almost one year, as market worries remained over planned rate hikes by the US Federal Reserve, dealers said.
The bellwether electronics sector continued its downtrend, led by large-cap semiconductor stocks, while the financial sector saw a sell-off as investors rushed to downsize their portfolios amid market volatility, they said.
The TAIEX at its close was down 359.28 points, or 2.19 percent, at the day’s low of 16,048.92. Turnover totaled NT$239.82 billion (US$8.07 billion), with foreign institutional investors selling a net NT$21.15 billion of shares on the main board, Taiwan Stock Exchange (TWSE) data showed.
Photo by Sam Yeh / AFP
Yesterday’s closing level was the lowest since May 20 last year, when the TAIEX ended at 16,042.36, TWSE data showed.
“While US Federal Reserve Chair Jerome Powell has ruled out an increase of 75 basis points in each of the upcoming policymaking meetings, the rate hike cycle has been put in place, and many investors at home and abroad are increasingly worried about liquidity being drained from the market,” MasterLink Securities Corp (元富證券) analyst Tom Tang (湯忠謙) said.
The Fed raised its key interest rate by 50 basis points in a meeting held last week after a 25 basis point increase in March in an attempt to tackle inflation.
“In Taipei, investors stayed jittery about the US markets’ performance, so they simply scrambled to further unload their holdings. Today, massive selling was seen among financial stocks, having spread from their tech counterparts,” Tang said.
The financial sector closed down by 3.4 percent, and the electronics sector fell by 1.72 percent overall, with the semiconductor subindex declining by 1.78 percent, and the transportation sector, which includes major shipping and airline stocks, declined 3.53 percent, TWSE data showed.
“Today’s turnover remained low, as many investors were reluctant to buy during the dips since they fear more losses down the road,” Tang said. “The market also remains alert to the impact on the economy from COVID-19 lockdowns in China.”
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