RTTNews - The Taiwan stock market on Friday halted the two-day losing streak in which it had given up nearly 120 points or 1.7 percent in the process. The Taiwan Stock Exchange closed above the 7,070-point plateau, and analysts are expecting the market to hold steady in that neighborhood when it opens for business on Monday.
The global forecast for the Asian markets offers little in the way of guidance as commodities and financials are tipped to continue to rise, but weakness among the technology shares could erase those gains. The European and U.S. markets finished in mixed fashion, although not too far from the unchanged line in either direction - and the Asian bourses are tipped to follow that lead.
The TSE finished modestly higher on Friday, thanks to significant gains among the construction, technology, textile and financial sectors. The gains were offset, however, by selling among the food and paper sectors.
For the day, the index gained 50.6 points or 0.72 percent to close at 7,077.71 after trading between 7,132.11 and 7,044.7. Volume was 5.67 billion shares worth 158.27 billion Taiwan dollars. There were 1,232 gainers and 1,058 decliners, with 189 stocks finishing unchanged.
The lead from Wall Street is inconclusive as stocks finished Friday's session on a mixed note after a shaky start prompted by gross domestic product figures for the second quarter. The major averages closed on opposite sides of the unchanged mark amid another session that was marred by low volume, typical of the summer.
Early trading was swayed by an advance report on second quarter gross domestic product from the Commerce Department. While the report revealed that the U.S. economy continued to shrink by a slower than expected margin, trader concern grew as consumer consumption came in far lower than expected. According to the data, gross domestic product fell at a pace of 1 percent for the second quarter after economists had expected GDP to fall at a rate of 1.5 percent. Some pessimism was generated by the personal consumption figure in the report, which showed a decrease of 1.2 percent, significantly more than economists had been expecting. This followed a 0.6 percent increase in the first quarter.
Later in the morning, traders largely shrugged off the Institute of Supply Management-Chicago's manufacturing index for July, which came in slightly higher than expected at 43.4. Economists expected the business barometer index to come in at 43 after rising by 5 points to 39.9 in June.
With earnings season drawing to a close, Disney (DIS) and Monster Worldwide (MWW) reported earnings that beat forecasts, while oil giant Chevron (CVX) disappointed. The season's earnings results largely beat expectations, but for the most part due to cost cutting measures rather than revenue growth in a market constricted by the recession.
After hovering in positive territory throughout much of the trading session, the major averages ended the day on opposite sides of the unchanged line. The tech heavy NASDAQ fell by 5.80 points or 0.3 percent to 1,978.50, while the Dow closed up by 17.15 points or 0.2 percent at 9,171.61 and the S&P 500 rose 0.73 points or 0.1 percent to 987.48. Despite the mixed performance for the session, the major averages all closed higher for the week due largely to Thursday's rally. The Dow rose 0.9 percent for the week, while the NASDAQ and the S&P 500 posted weekly gains of 0.6 percent and 0.8 percent, respectively.
In corporate news, Advanced Semiconductor Engineering, Inc. reported a sharp decrease in profit for the second quarter, hurt mainly by revenue declines across all the business segments. For the quarter, the Taipei-based company's net income was NT$1.67 billion or NT$0.32 per share compared with NT$2.41 billion or NT$0.42 per share in the prior-year quarter. On an American Depository Shares basis, earnings slid to US$0.049 per ADS from US$0.070 per ADS a year ago.
The results reflect a 5 percent increase from fiscal 2008 in depreciation, amortization and rental expenses totaling to NT$4.17 billion. The company's net revenues for the quarter slumped to NT$20.88 billion from NT$25.61 billion in the second quarter of fiscal 2008.
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