Shares in Taiwan carried the momentum from a session earlier to close above the 18,000 point mark and hit a historic closing level Monday, with the bellwether electronics sector leading the upturn throughout the session.

Turnover remained thin due to the absence of many foreign institutional investors who have been away from the trading floor for the New Year holiday, according to dealers.

The Taiex, the weighted index on the Taiwan Stock Exchange (TWSE), ended up 87.30 points, or 0.49 percent, at 18,048.94, after moving between 17,975.41 and 18,099.78.

Turnover for the session totaled NT$236.45 billion (US$8.54 billion).

The market opened up 0.08 percent, and momentum on the local main board gained speed as select tech heavyweights, in particular in the semiconductor industry, attracted buying to vault the Taiex over the high technical hurdles ahead of 18,000 points.

The semiconductor industry’s continued strength even pushed up the main board to close at a historic high, dealers said.

On Monday, the electronics sector rose 0.62 percent, with the semiconductor industry sub-index up 0.59 percent.

“Rotational buying continued to dictate the local main board,” said Mega International Investment Services Corp. analyst Alex Huang. “Today, high-priced integrated circuit designers were spotlighted.”

Leading the semiconductor industry’s upturn, smartphone chip designer MediaTek Inc. rose 2.23 percent to close at NT$1,145.00 amid optimism toward the shipments of the company’s flagship 5G Dimensity 9000 chip.

In a recent product review, the Dimensity 9000 appeared faster and more efficient than the latest flagship released by rival Qualcomm Inc.

“MediaTek uses TSMC (Taiwan Semiconductor Manufacturing Co.)’s technology, which is stronger than Samsung Electronics Corp.’s, used by Qualcomm,” Huang said. “In recent sessions, such optimism toward MediaTek’s business outlook served as a driver to the stock.”

Buying in MediaTek was also seen among other high-priced IC designers with power management IC designer Silergy Corp. soaring 4.79 percent to close at NT$5,030.00, and application-specific IC designer Alchip Technologies Ltd. jumping 3.43 percent to end at NT$1,025.00.

The world’s largest contract chipmaker TSMC, the most heavily weighted stock in the local market, rose 0.33 percent to close at NT$606.00. The gains boosted TSMC’s market capitalization by NT$51.8 billion to NT$15.71 trillion and contributed about 14 points to the Taiex’s upturn, while low turnover limited its gains, dealers said.

Among other semiconductor stocks, United Microelectronics Corp., a smaller contract chipmaker, closed unchanged at NT$64.30, while dynamic random access memory (DRAM) chip supplier Nanya Technology Corp. rose 1.19 percent to end at NT$76.60.

Also in the electronics sector, iPhone assembler Hon Hai Precision Industry Co. rose 0.48 percent to close at NT$104.50, and Largan Precision Co., a supplier of smartphone camera lenses to Apple Inc., gained 0.20 percent to end at NT$2,450.00.

“As the tech sector served as a driver to the Taiex, many old economy stocks appeared marginalized,” Huang said.

The transportation sector rose 0.49 percent on the back of airline stocks’ gains, with China Airlines up 3.05 percent to close at NT$27.00 and EVA Airways up 2.24 percent to end at NT$27.40.

Shipping stocks, however, were mixed. Evergreen Marine Corp., the largest container cargo shipper in Taiwan, was up 0.36 percent to close at NT$139.50, while rivals Yang Ming Marine Transport Corp. and Wan Hai Lines Ltd ended unchanged at NT$122.50 and NT$199.00, respectively.

Elsewhere, Formosa Plastics Corp. rose 0.48 percent to close at NT$104.50, and textile supplier Far Eastern New Century Corp. gained 0.35 percent to end at NT$29.00, while Taita Chemical Co. lost 0.29 percent to close at NT$33.85, and food brand Uni-President Enterprises Corp. fell 0.15 percent to end at NT$68.40.

In the financial services sector, which rose 0.09 percent, Fubon Financial Holding Co. closed unchanged at NT$75.20, while Cathay Financial Holding Co. rose 0.33 percent to end at NT$61.30.

“Today’s gains have boosted market sentiment so I expect local institutional investors will continue to buy at a time when many foreign institutional investors are absent,” Huang said. “But, stiff technical resistance could be seen ahead of 18,250 points.”

According to the TWSE, foreign institutional investors bought a net NT$11.17 billion worth of shares on the main board Monday.

Source: Focus Taiwan News Channel