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Mild Recovery Called For Taiwan Stock Market

The Taiwan stock market on Monday halted the four-day winning streak in which it had surged more than 185 points or 2.5 percent. The Taiwan Stock Exchange finished just below the 7,730-point plateau, and now analysts are forecasting a slight rebound at the opening of trade on Tuesday.

The global forecast for the Asian markets is mixed as lingering concerns from Europe offset better than expected economic data from the United States. In Europe, Spain's ten-year borrowing costs moved above 6 percent on Monday ahead of a key debt auction, adding to worries over the contagion risk of the sovereign debt crisis and the health of the economy. The European markets finished higher on Monday and the U.S. bourses were mixed - and the Asian markets are tipped to split the difference.

The TSE finished modestly lower on Monday following losses from the plastic, finance, paper, cement, textile, construction and technology sectors.

For the day, the index declined 58.41 points or 0.75 percent to finish at 7,729.86 after trading between 7,714.14 and 7,749.49 on turnover of 58 billion Taiwan dollars. There were 2,824 gainers and 1,043 decliners, with 372 stocks finishing unchanged.

Among the gainers, Uni-President Enterprises added 1.70 percent and Namchow Chemical Industrial collected 1.61 percent.

Wall Street provides little clarity as stocks were mixed on Monday following the release of conflicting U.S. economic data. Uncertainty about the outlook for corporate earnings also impacted trading, along with renewed concerns about the European debt crisis.

Initial buying interest was generated when the U.S. Commerce Department reported that retail sales rose by 0.8 percent in March following a revised 1.0 percent increase in February. Economists had been expecting an increase of 0.3 percent. Excluding a 0.9 percent increase in auto sales, retail sales still rose by 0.8 percent in March compared to a 0.9 percent increase in the previous month.

However, disappointing New York manufacturing data offset the positive sentiment, with the New York Federal Reserve reporting that its general business conditions index plunged to 6.6 in April from 20.2 in March, although a positive reading indicates an increase in manufacturing activity. The index had been expected to edge down to 18.0.

Separately, the National Association of Home Builders reported an unexpected deterioration in homebuilder confidence in April, marking the first drop in seven months. The NAHB/Wells Fargo Housing Market Index dropped to 25 in April from 28 in March. The decrease surprised economists, who had expected the index to edge up to 29.

Notable losses by Apple (AAPL) and Google (GOOG) contributed to the pullback by the NASDAQ, with the tech heavyweights falling by 4.2 percent and 3 percent, respectively.

Meanwhile, shares of Citigroup (C) ended the day up by 1.8 percent after the financial giant released its first quarter results before the start of trading. While Citigroup reported net income that fell to $0.95 per share from $0.99 per share in the same quarter a year ago, the company's adjusted earnings rose to $1.11 per share.

While the Dow remained positive throughout the session, the NASDAQ and the S&P 500 closed in the red. The Dow rose by 71.82 points or 0.6 percent to finish at 12,921.41, while the NASDAQ fell 22.93 points or 0.8 percent to end at 2,988.40 and the S&P 500 edged down 0.69 points or 0.1 percent to 1,369.57.

by RTT Staff Writer

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