Market cap on main board rises over 5.6% in single session

Taipei-The market capitalization of the local main board soared more than 5.6 percent in one session Wednesday, when the benchmark weighted index moved sharply higher, playing catch-up with U.S. markets which rose during the break for the Lunar New Year holiday, according to the Taiwan Stock Exchange (TWSE).

Boosted by strong gains posted by the weighted index on the TWSE or the Taiex, which rose 559.89 points or 3.54 percent to end at a record high of 16,362.29 on Wednesday, the first trading session after an 11-day market recess, the market cap on the main board gained about NT$2.7 trillion (US$95.41 billion) or 5.62 percent to pass NT$50 trillion.

Amid ample liquidity and a strong showing by tech stocks on U.S. markets during the holiday break, the Taiex scored its second highest index increase ever on Wednesday, trailing only the 590.19 point rise on Nov. 29, 1989. The buying on the first trading session of the Year of the Ox extended the 30.4 percent increase recorded during the Year of the Rat.

In addition to the record closing level for the Taiex on Wednesday, the index also hit a new intraday high of 16,406.78 points.

The tech sector led the upturn with contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC), the most heavily weighted stock on the local market, rising 4.91 percent to end at NT$663.00 after its American depositary receipts soared 9.18 percent during the market break.

On Wednesday, foreign institutional investors bought a net NT$29.72 billion worth of shares on the main board, the TWSE’s statistics showed.

United Microelectronics Corp., a smaller contract chipmaker, ranked No. 1 in foreign institutional investors’ net purchases of 82.21 million shares among the stocks listed on the main board on Wednesday.

Evergreen Marine Corp., the largest shipping company in Taiwan, came second with net buying of 39.87 million shares by foreign institutional investors. TSMC ranked 17th with net buying of 67.18 million shares.

So far in February, foreign institutional investors have registered net purchases of NT$35.95 billion on the main board after net sales of NT$113.08 billion in January, the TWSE’s data showed.

Tsai Ming-han, an analyst with Cathay Futures Consulting, said it is possible foreign institutional investors will continue to pick up shares in Taiwan at a time when the market remains awash in liquidity.

Tsai added that the bellwether electronics sector is expected to continue to drive the gains on the main board on the back of continued solid global semiconductor demand.

Source: Focus Taiwan News Channel