A technical rebound after a steep decline for three straight sessions was far from a big surprise.

It was a totally technical rebound after the decline of Thursday. The stocks that stood out were blue-chips that were battered previously, especially the service and telecommunications sector.

In our house, there were far more sell than buy orders. There was a conspicuous increase in short [sell] contracts, reflecting a desire to hedge against the prospect of a further decline ... in the near-term.

Vendors are likely to see a fundamental shift in the market as they come to grips with the steep decline in mature-market desk-based growth and are forced to seek growth in other market segments.

Concerns over a possible straining in already tense relations across the Taiwan Strait remained a drag on the market.

This came as a big surprise and a big letdown.