The Taiwan stock market has closed lower now in consecutive sessions, plummeting almost 150 points or 2.2 percent in the process. The Taiwan Stock Exchange finished just below the 7,125-point plateau, and now traders are anticipating a measure of traction when the market kicks off trade on Friday.
The global forecast for the Asian markets is cautiously optimistic, thanks to good news from Europe that was somewhat conditional. Wednesday's EU summit resulted in the clear message that their leaders want Greece to remain in the euro area - but German Chancellor Angela Merkel reinforced her opposition to the idea of issuing eurobonds at the summit. The European markets were higher and the U.S. bourses were mixed but little changed, and the Asian markets figure to split the difference.
The TSE finished modestly lower on Thursday as losses from the paper, construction, textile, food and finance sectors was offset by support from the cement stocks.
For the day, the index lost 22.86 points or 0.31 percent to finish at 7,124.89 after trading between 7,090.47 and 7,190.55 on turnover of 64.24 billion Taiwan dollars.
Among the gainers, Taiwan Semiconductor Manufacturing Co. jumped 1.90 percent and HTC climbed 1.78 percent.
Wall Street provides little clarity as stocks showed a lack of direction on Thursday, as traders seemed reluctant to make any significant moves. The choppy trading came after the markets saw considerable volatility over the course of the two previous sessions.
While some analysts have described the markets as oversold in light of the recent weakness, traders appear reluctant to go bargain hunting amid continued concerns about the financial situation in Europe.
European leaders have voiced their strong desire for Greece to remain in the eurozone and honor its commitments under previously agreed bailout deals that require the implementation of reforms and unpopular austerity measures. There are also hopes that the new Greek government that emerges from next month's general elections will implement the reforms and measures needed to bring the crisis-hit nation back on the road to progress.
Traders also digested some uninspiring U.S. economic data as the Commerce Department reported that orders for non-defense capital goods excluding aircraft, which are seen as an indicator of capital spending, fell by 1.9 percent in April following a 2.2 percent drop in March. The data was included in the report on durable goods orders in April, which showed a mild increase in orders amid a rebound in transportation equipment orders.
A separate report from the Labor Department showed a modest decrease in initial jobless claims in the week ended May 19. Jobless claims edged down to 370,000 from the previous week's revised figure of 372,000.
Among individual stocks, Hewlett-Packard (HPQ) rose by 3.3 percent after reporting better than expected second quarter results and raising its full year adjusted earnings guidance. Shares of Pandora Media (P) also showed a strong upward move after the online radio service reported a narrower than expected first quarter loss and provided upbeat guidance.
Meanwhile, shares of Tiffany (TIF) came under pressure after the luxury goods retailer reported weaker than expected first quarter earnings and slashed its full year guidance.
On the corporate front, Japanese chipmaker Renesas Electronics will enter a chip production tie-up with Taiwan Semiconductor Manufacturing Co. as a step to lower costs, reports said. Chips will be produced by TSMC for use in automobiles and home appliances for Renesas, the reports said. Renesas provided no details on the tie-up.
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