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Taiwan Stock Market May Open Under Pressure On Monday

taiwan-stock-market-may-open-under-pressure-on-monday

(RTTNews) – The Taiwan stock market has finished sharply lower in two straight sessions, sinking more than 540 points or 3.6 percent along the way. The Taiwan Stock Exchange now sits just beneath the 15,140-point plateau and it’s likely in for another wild ride again on Monday.

The global forecast for the Asian markets suggests further volatility thanks to ongoing short-selling issues. The Asian markets have a solidly negative lead from Europe and the U.S. – and they may open that way, but bargain hunters may emerge later in the day to boost the oversold bourses.

The TSE finished sharply lower on Friday following losses from the financial shares, technology stocks and cement and plastics companies.

For the day, the index plunged 277.59 points or 1.80 percent to finish at the daily low of 15,138.31 after peaking at 15,603.41.

Among the actives, Cathay Financial shed 0.50 percent, while Mega Financial declined 1.40 percent, CTBC Financial sank 1.04 percent, Fubon Financial dropped 1.41 percent, First Financial lost 0.74 percent, E Sun Financial fell 1.67 percent, Taiwan Semiconductor Manufacturing Company skidded 1.66 percent, United Microelectronics Corporation tumbled 2.34 percent, Hon Hai Precision plunged 5.91 percent, Largan Precision retreated 2.81 percent, Catcher Technology surrendered 3.41 percent, MediaTek added 0.69 percent, Formosa Plastic tanked 2.36 percent, Asia Cement skid 0.87 percent and Taiwan Cement eased 0.25 percent.

The lead from Wall Street is broadly negative as the major averages opened solidly in the red on Friday and saw the losses accelerate as the session progressed – offsetting gains from the previous day.

The Dow plummeted 620.78 points or 2.03 percent to finish at 29,982.62, while the NASDAQ tumbled 266.46 points or 2.00 percent to end at 13,070.69 and the S&P 500 lost 73.14 points or 1.93 percent to close at 2,714.24. For the week, the Dow, NASDAQ and S&P all fell 3.5 percent.

The sell-off on Wall Street reflected concerns about recent market volatility of heavily shorted stocks like GameStop (GME) and AMC Entertainment (AMC) – which moved sharply higher after Robinhood eased restrictions on certain stocks that have recently skyrocketed.

The spikes by the heavily shorted stocks have been described as a retail investor revolt, raising concerns that hedge funds may have to sell other securities to make up for their losses.

In economic news, the Commerce Department noted a much bigger than expected increase in personal income in December, along with a modest decrease in personal spending. Also, the University of Michigan said consumer sentiment deteriorated more than expected in January.

Crude oil futures settled lower Friday as worries about the outlook for energy demand due to rising coronavirus cases and delays in vaccine supplies weighed on prices. West Texas Intermediate Crude oil futures for March ended down $0.14 or 0.3 percent at $52.20 a barrel.

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