Taiwanese shares moved higher yesterday on a technical rebound, but the gains were capped by a late sell-off of large-cap semiconductor stocks, dealers said.
Turnover also remained low as investors worried the US Federal Reserve could follow a tighter monetary policy after the US on Friday reported stronger-than-expected job data for last month, they said.
The bellwether electronics sector and transportation stocks initially led the upturn before profit-taking emerged.
Buying rotated to select old-economy stocks and some financial stocks, lending support to the broader market, the dealers added.
The TAIEX closed up 53.39 points, or 0.32 percent, at 16,605.96. Turnover totaled NT$210.28 billion (US$7.15 billion), with foreign institutional investors selling a net NT$2.21 billion in shares on the main board, Taiwan Stock Exchange data showed.
“Look at today’s turnover. I think market sentiment remained cautious after the US’ May non-farm payroll data. Many investors appeared reluctant to chase prices for the time being,” Hua Nan Securities Co (華南永昌證券) analyst Lu Chin-wei said.
“Caution over a more aggressive rate hike cycle in the US continues to weigh on American stock markets, and investors here are nervous that further US volatility will send ripples through other stock markets, including Taiwan’s,” Lu said.
“As the US dollar continues to strengthen due to the Fed’s interest rate hikes, it is unlikely foreign institutional investors will resume heavy buying of shares in Taiwan any time soon,” he said.
The New Taiwan dollar declined NT$0.027 to close at NT$29.415 against the US dollar in Taipei trading yesterday.
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