Taiwan share prices are expected to test 6,800 points on possible selling by foreign investors, dealers said on Friday. A probe into money laundering claims against former president Chen Shui-bian is likely to keep the market jittery, although the impact may fade to some extent after hitting the market badly this week, dealers said.
Any technical rebound during the week may face strong resistance at 7,200 points, they added. For the week to August 22, the weighted index closed down 284.86 points or 3.96 percent at 6,911.64. Average daily turnover stood at 80.30 billion Taiwan dollars (2.56 billion US), compared with 114.11 billion dollars a week ago.
Grand Cathay Securities analyst Mars Hsu said Wall Street's movements were expected to continue to dictate global markets. "Possible Wall Street volatility may drive foreign investors here to sell... Fears of depleting liquidity will further undermine local market sentiment," Hsu said.
Foreign institutional investors sold a net of 35.51 billion dollars worth of shares this week. However, Hsu said financials could struggle, but that electronic heavyweights such as Taiwan Semiconductor Manufacturing Co, IC designer MediaTek and smart phone maker HTC Corp, may appear relatively resilient.