RTTNews - The winning streak has reached seven sessions now for the Taiwan stock market, which has surged more than 440 points or 5.8 percent in the process. The Taiwan Stock Exchange continues to flirt with the 7,000-point level, but analysts are now predicting a modest retreat when the market opens for business on Thursday.
The global forecast for the Asian markets is a study in contrasts as expected strength in the technology sectors is likely to be offset by falling oil stocks reacting to a decline in the price of oil. The day's corporate earnings results are also unlikely to spark momentum. The European and U.S. markets finished in mixed fashion but did not stray too far from the unchanged line in either direction - and the Asian markets are expected to show little movement with perhaps a slight downside bias.
The TSE finished modestly higher on Wednesday, thanks to solid gains among the textiles and financials, while the technology, cement and paper stocks also finished higher. The gains were offset by selling among the construction, food and plastic shares.
For the day, the index gained 31.98 points or 0.45 percent to close at 6,985.32 after trading between 7,030.13 and 6,955.37. Volume was 5.75 billion shares worth 145.15 billion Taiwan dollars. There were 1,282 gainers and 960 decliners, with 226 stocks finishing unchanged.
Among the actives, Nanya Technology Corp. rose 4.24 percent, while Powerchip Semiconductor Corp rose 0.76 percent, Taiwan Semiconductor Manufacturing Co fell 0.36 percent and Hua Nan Financials rose 0.98 percent.
Wall Street offers an inconsistent lead as stocks finished on a mixed note after choppy trade throughout Wednesday's session, reacting to the latest earnings results with low volume. The major averages closed on opposite sides of the unchanged mark, largely unable to extend their recent run-up.
Earlier this morning, traders delved into quarterly results from a number of big-name companies including Apple (AAPL), Yahoo! (YHOO), Pfizer (PFE) Boeing (BA), Morgan Stanley (MS), Wells Fargo (WFC), and PepsiCo (PEP). The reports saw mixed reaction, however, as most firms met or beat estimates by cost cutting rather than through revenue growth.
In other news, Federal Reserve Chairman Ben Bernanke redelivered his address regarding monetary policy before the Senate Banking Committee while also fielding questions regarding the current and near-term economic outlook. In his prepared remarks, Bernanke reiterated that the U.S. economy is showing signs of stabilization, although he noted that the economy is still in a fragile state, with unemployment high and consumer spending shaky.
Questioning the Fed chief, Sen. Chris Dodd, D-Conn., the chairman of the Senate Banking Committee, noted that while some signs of economic recovery have been seen on Wall Street, the benefits have yet to make it to Main Street.
Bernanke conceded that unemployment is the most pressing issue facing the Fed, but he noted that there are steps that Congress could take to ease the situation, similar to the already-passed extension of unemployment benefits. He said one serious concern was that the long-term unemployed might see their job skills atrophy, leaving them unqualified for work once the economy recovers. Extending job training programs might be one response Congress should consider, the Fed chief said.
The major averages moved sideways in late session dealing to cap off a lackluster trading day. While the NASDAQ eked out a gain of 10.18 points or 0.5 percent, finishing at 1,926.38, the Dow fell by 34.68 points or 0.4 percent to 8,881.26. Further, the S&P 500 slipped by 0.51 points or 0.1 percent to close at 954.07.
In economic news, Taiwan will on Thursday provide June numbers for export orders and industrial output. Export orders are expected to fall 18.7 percent on year following the 20.14 percent annual contraction in May. Output is called lower by 16 percent on year after falling 18.31 percent on year in the previous month.
Also, commercial sales posted an annual decrease 5.32 percent in June after falling 11.63 percent in May, the Ministry of Economic Affairs said on Wednesday. Including wholesale trade, commercial sales decreased 6.82 percent in June and dropped 1.49 percent including retail trade. Meanwhile, it rose 1.2 percent when food services added.
Finally, Taiwan's seasonally adjusted jobless rate moved up to 5.91 percent in June from 5.84 percent in the preceding month, the Directorate General of Budget, Accounting and Statistics said on Wednesday. Economists expected the rate to be 5.9 percent.
During the month, the number of unemployed persons increased to 645,000 from 637,000 in the preceding month. At the same time, the number of employed remained almost unchanged at 10.25 million. The total number in the labor force grew to 10.9 million from 10.89 million, but the participation rate remained unchanged at 57.87 percent.
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