Shares in Taiwan moved higher by more than 200 points Monday as market sentiment improved on the back of gains in the United States markets last Thursday and Friday, when the local equity market was closed for the long Mid-Autumn Festival weekend, dealers said.
The local main board was led by large cap tech stocks, in particular contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC), which was boosted by a record high sales report for August, dealers added.
The Taiex, the weighted index on the Taiwan Stock Exchange (TWSE), ended up 224.01 points, or 1.54 percent, at 14,807.43, after moving between 14,711.34 and 14,856.23. Turnover totaled NT$184.47 billion (US$5.97 billion).
The market opened up 0.88 percent with investors encouraged to buy following a roughly 1.8 percent increase on the Dow Jones Industrial Average in the last two trading sessions of last week, dealers said.
TSMC
Buying accelerated to push the Taiex above 14,800 points by the end of the session as TSMC and other semiconductor heavyweights continued to move higher amid eased concerns over a rate hike the U.S. Federal Reserve in September, dealers added.
After its American depositary receipts (ADRs) gained 1.61 percent on U.S. markets Friday, TSMC, the most heavily weighted stock on the local market, rose 2.42 percent to close at NT$486.50 on Monday.
The chipmaker posted a new monthly record of NT$218.13 billion in consolidated sales in August.
TSMC’s gains led the bellwether electronics and the semiconductor sub-index to move higher by 1.77 percent and 2.21 percent, respectively, serving as a driver to the upturn on the broader market throughout the session, dealers said.
“Judging from the performance of TSMC and other high tech stocks, I think market sentiment has turned better as more and more investors seem to have accepted market expectations that the Fed will raise its key interest rates by an additional 75 basis points later this month,” Concord Securities analyst Kerry Huang said.
“The Taiwan dollar has turned stable against the U.S. dollar after volatility seen last week, indicating foreign institutional investors shifted to the buy side, resuming buying today, especially in the tech sector,” Huang said, referring to the greenback’s closing level at NT$30.870 against the Taiwan dollar, down NT$0.025 from the previous session.
According to the TWSE, foreign institutional investors bought a net NT$11.21 billion worth of shares on the main board Monday after net sales of NT$2.45 billion on Sept. 8, the last trading session before the long holiday weekend began.
Other tech stocks
Among other semiconductor heavyweights, United Microelectronics Corp., a smaller contract chipmaker in Taiwan, rose 2.16 percent to end at NT$40.15 following a 1.88 percent increase in its ADRs on Friday, and dynamic random access memory (DRAM) chip supplier Nanya Technology Corp. added 2.35 percent to close at NT$52.30.
In addition, power management IC designer Silergy Corp. surged 6.50 percent to end at NT$508.00, and application-specific IC (ASIC) designer Alchip Technologies Ltd. soared 7.03 percent to close at NT$959.00.
Smartphone IC designer MediaTek Inc. underperformed the broader market, rising only 0.64 percent to end at NT$627.00 on weakening demand for smartphones worldwide.
After strong pre-order sales of the latest iPhone 14 series over the weekend, Hon Hai Precision Industry Co., the largest assembler of Apple Inc’s smartphones, rose 1.40 percent to close at NT$108.50.
Shares in smartphone lens supplier Largan Precision Co. gained 1.52 percent to end at NT$2,000.00.
Shipping firms, airlines
“The shipping industry also bounced back today, giving additional support to the Taiex, but I think the gains were technical in nature as the industry is encountering falling freight rates due to weakening demand,” Huang said.
In the transportation sector, which rose 2.36 percent, container cargo shipper Yang Ming Marine Transport Corp., which has said China’s zero COVID-19 tolerance policy is hurting the shipping industry, rose 4.72 percent to close at NT$71.00, and rival Wan Hai Lines Ltd. gained 3.78 percent to end at NT$76.90.
On the bulk cargo shipping front, U-Ming Marine Transport Corp. added 2.43 percent to close at NT$37.90, and Chinese Maritime Transport Ltd. gained 1.86 percent to end at NT$35.65.
Also in the transportation sector, China Airlines rose 2.28 percent to close at NT$22.40, and EVA Airways gained 2.26 percent to end at NT$33.90 on hopes that the government will further ease border controls to boost the tourism industry, dealers said.
Elsewhere in the old economy sector, Walsin Lihwa Corp., one of Taiwan’s leading cable and wire suppliers, rose 2.48 percent to close at NT$39.30 after its sales for the first eight months of the year soared more than 27 percent from a year earlier on the back of the contribution made by a new plant in Indonesia.
In the financial sector, which grew 1.12 percent, Cathay Financial Holding Co. rose 2.09 percent to end at NT$44.05, and Fubon Financial Holding Co. added 1.42 percent to close at NT$57.30, while CTBC Financial Holding Co. ended unchanged at NT$22.90.
“Despite the strong gains today, turnover remained thin, indicating many investors were reluctant to chase prices for the moment, waiting for the U.S. August consumer price index due later this week for more clues about what the Fed will do after a possible 75 basis point rate hike in September,” Huang said.
According to Huang, Monday’s turnover was lower than the average of about NT$190 billion for the past five trading sessions.
Source: Focus Taiwan News Channel