The Taiwan stock market has finished lower in two straight sessions, retreating more than 75 points or 0.8 percent in the process. The Taiwan Stock Exchange finished just below the 8,750-point plateau, and now analysts are forecasting continued consolidation when the market kicks off trade on Monday.
The global forecast for the Asian markets is broadly negative following much weaker than expected employment data from the United States. Losses figure to be broadly based at the open, although brokerages and technology stocks may be hit particularly hard. The European and U.S. markets finished firmly in the red, and the Asian bourses are expected to follow suit.
The TSE finished modestly lower again on Friday following losses from the technology and paper stocks, although the food and construction stocks provided support.
For the day, the index eased 23.87 points or 0.27 percent to finish at 8,749.55 after trading between 8,740.00 and 8,839.14 on turnover of 131.59 billion Taiwan dollars.
Among the actives, HTC shed 4.90 percent and Siliconware Precision Industries lost 4.29 percent, while Uni-President Enterprises surged 6.14 percent and Hung Ching Development spiked 5.68 percent.
The lead from Wall Street suggests consolidation as stocks closed lower on Friday on the heels of much weaker than expected employment data, although the major averages ended the session well off their worst levels of the day. Optimism about the upcoming earnings season helped to lift stocks off their lows in afternoon trading.
Stocks plunged following the release of a Labor Department report showing much weaker than expected job growth in June. The report showed that U.S. employment edged up by just 18,000 jobs in June following a downwardly revised increase of 25,000 jobs in May. Economists had been expecting employment to increase by more than 100,000 jobs. Additionally, the unemployment rate unexpectedly ticked up to 9.2 percent in June from 9.1 percent in May, which was also up slightly from April.
In other economic news, the Commerce Department released a report showing that wholesale inventories rose by 1.8 percent in May, double the expectations of economists. On the other hand, wholesale sales edged down by 0.2 percent.
Among individual stocks, shares of Google (GOOG) came under pressure after Morgan Stanley lowered its rating on the internet search giant to equal weight from overweight. Google fell by 2.7 percent after ending the previous session at a nearly three-month closing high.
Meanwhile, WD-40 (WDFC) surged up by 6.6 percent after the consumer products maker reported weaker than expected third quarter results but provided full year guidance in line with analyst estimates. With the gain, shares of WD-40 set a record closing high.
The major averages continued to regain ground going into the close but still ended the day in the red. The Dow closed down by 62.29 points or 0.5 percent at 12,657.20, the NASDAQ fell 12.85 points or 0.5 percent to 2,859.81 and the S&P 500 dropped 9.42 points or 0.7 percent to 1,343.80. Despite the losses on the day, the major averages all moved higher for the holiday-shortened week. The tech-heavy NASDAQ surged up by 1.6 percent for the week, while the Dow and the S&P 500 rose by 0.6 percent and 0.3 percent, respectively.
In corporate news, United Microelectronics Corp on Friday said net sales for the month of June slid 11.13 percent year-over-year. For the six months since January 2011, net sales fell marginally from the prior year net sales for the same year. June net sales decreased to 9.19 billion New Taiwan dollars from 10.34 billion New Taiwan dollars a year ago. Half-yearly net sales were 56.27 billion New Taiwan dollars this year compared to 56.46 billion New Taiwan dollars last year.
For comments and feedback: editorial@rttnews.com