Taipei, Shares in Taiwan climbed more than 100 points Monday to end above the 11,000 mark, as investors took cues from the gains on regional markets and set aside the rising tensions between Washington and Beijing, dealers said.
The bellwether electronics sector led the upturn, after semiconductor stocks rallied on the U.S. markets at the end of last week, while market sentiment was also boosted by hopes of a reopening of business in the United States and Europe, dealers said.
The weighted index on the Taiwan Stock Exchange (Taiex) ended up 136.86 points, or 1.25 percent, at 11,079.02, after moving between 10,971.40 and 11,109.29. Turnover totaled NT$166.39 billion (US$5.56 billion) during the session.
The market opened up 0.27 percent on a technical rebound from a slump in the past two sessions, and buying accelerated, particularly among semiconductor stocks after the Philadelphia Semiconductor Index soared 2.65 percent on Friday, dealers said.
A strong showing on the Hong Kong market and others in the region prompted investors in Taiwan to pick up bargains in the old economy and financial sectors, which helped the Taiex overcome the technical barriers ahead of the 11,000-mark by the end of the session, dealers said.
“Looking at the gains in Hong Kong, it seemed that investors in the region decided to put the U.S.-China tensions behind them for the moment,” Hua Nan Securities analyst Lu Chin-wei said, referring to U.S. President Donald Trump’s plan to revoke Hong Kong’s preferential tariff status after China moved to impose a new national security law on the territory.
“That particular negative factor seemed to have been digested to some extent,” Lu said.
He said the gains on the Philadelphia Semiconductor Index last week also encouraged investors in Taiwan to buy semiconductor stocks, which helped drive up the Taiex on Monday.
In the electronics sector, which closed up 1.40 percent, contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC), the most heavily weighted stock on the local market, gained 1.20 percent to end at NT$295.50.
“After TSMC’s consolidation for most of May, it might kick off an uptrend in June, leading the broader market higher,” Lu said.
The buying in TSMC spread to other integrated circuit stocks, with Asmedia Technology Inc. gaining 5.73 percent to close at NT$1,200.00 and Novatek Microelectronics Corp. ending up 1.71 percent at NT$208.50.
Also in the tech sector, smartphone camera lens supplier Largan Precision Co. rose 6.00 percent to end at NT$4,065.00, while iPhone assembler Hon Hai Precision Industry Co. ended 0.53 percent higher at NT$76.20.
“Amid improving market sentiment toward the reopening of the global economy, investors were also hunting for bargains among non-tech stocks,” Lu said. “Judging from the gains by financial stocks, I suspect some of the buying involved government-led funds.”
In the financial sector, which closed up 0.91 percent, E. Sun Financial Holding Co. rose 1.50 percent to close at NT$27.05, and Yuanta Financial Holding Co. added 2.46 percent to end at NT$16.65.
Among the old economy stocks, Formosa Petrochemical Corp. rose 2.51 percent to close at NT$89.90, and Formosa Plastics Corp. finished 0.96 percent higher at NT$83.80.
“Today’s gains helped the Taiex jump over the 240-day moving average of about 11,000 points, so the market has become technically healthier, paving the way for further gains,” Lu said.
According to the TWSE, foreign institutional investors bought a net NT$14.50 billion worth of shares on the main board Monday.
Source: Focus Taiwan News Channel