Local suppliers rebound as Apple shares resilient overnight
Central News Agency
2014-09-03 12:10 PM
Taipei, Sept. 3 (CNA) Shares of Taiwanese suppliers to Apple Inc. staged a technical rebound for the most part Wednesday morning after shares of the U.S. electronics giant stayed resilient overnight despite the alleged hacking of its iCloud storage services, dealers said. Investors still have high hopes that Apple's next generation of iPhones will boost the company's smartphone shipments, which would in turn strengthen the bottom lines of its local suppliers, such as manufacturer Hon Hai Precision Industry Co., lens supplier Largan Precision Co., and casing maker Catcher Technology Co. As of 11:15 a.m., shares of Hon Hai, the world's largest contract electronics maker, had added 0.50 percent to NT$101.00 (US$3.38) with 12.23 million shares changing hands. Shares of Largan had gained 1.25 percent to NT$2,435.00, while shares of Catcher had risen 3.51 percent to NT$309.50. The weighted index on the Taiwan Stock Exchange was up 0.45 percent at 9,441.72 points. "The hacking of Apple's iCloud services (earlier this week) shocked investors here yesterday, prompting them to unload local Apple concept stocks to send the broader market into a tailspin," MasterLink Securities analyst Tom Tang said. Despite concerns, Apple shares rose 0.78 percent in the U.S. market overnight even after the incident in which hackers gained access to nude photos of several celebrities, including Oscar winner Jennifer Lawrence, apparently by breaching Apple's cloud storage system. "Now, the market attention shifted back to the highly expected launch of the new iPhone, and investors returned to the trading floor to short cover the hard-hit Apple concept stocks today," Tang said. Apple has issued an invitation to the press to attend an event scheduled for Sept. 9, where it is expected to unveil two new iPhone models with larger displays of 4.7 inches and 5.5 inches. Media in Taiwan reported that China Mobile, the largest telecom operator in China, kicked off a presale order campaign on Sept. 1 and received orders for 60,000 new iPhones that day despite the handset not even being official yet. The two other leading Chinese telecom operators, China Telecom and China Unicom are expected to work with Apple to sell the new iPhones in the potentially huge market as well. "The launch of the new iPhones remained a focus of the local equity market so that investors shrugged off the impact resulting from the iCloud hacking incident," Tang said. In a research note, Hong Kong-based CIBC Securities said it has expected that iPhone shipments for 2014 will rise about 18 percent from a year earlier to 180 million units on the release of the new models. The brokerage said that iPhone users generally have high loyalty to Apple's products, and the new releases are likely to lure existing customers back to buy more. Tang noted, however, that even though Apple concept stocks had made a strong showing in terms of share prices in recent sessions, the room for a further uptrend could be limited. "For example, Largan shares have appeared expensive after recent gains based on an estimate of about NT$100 in earnings per share for 2014" compared with NT$71.64, Tang said. But Tang said shares of Catcher could continue to move higher to test the nearest technical resistance at around NT$320 as the metal casing firm is expected to benefit from product price hikes to further boost its profitability. (By Frances Huang)
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