Taipei: Shares in Taiwan soared by over 700 points Monday, fueled by a rally in the U.S. markets. The surge came on the back of weaker-than-expected job data from the U.S., which alleviated fears of an imminent Federal Reserve rate hike, according to stock market dealers.
According to Focus Taiwan, the Taiex, Taiwan Stock Exchange's benchmark index, climbed 702.85 points, or 1.59 percent, to close at 44,928.76. The index traded between 44,540.71 and 45,219.40, with a turnover totaling NT$847.37 billion (US$26.33 billion). Kerry Huang, an analyst at Concord Securities, noted that concerns about a potential rate hike in September diminished following the release of July's nonfarm payrolls data. The U.S. economy reportedly lost 23,000 jobs in July, contrary to market projections of an 80,000 job increase.
Huang highlighted that the positive performance of U.S. markets on Friday set a precedent for Asian markets, including Taipei, which followed suit. The tech-heavy Nasdaq index's 1.30 percent gain on Friday led to a 1.80 percent rise in the local electronics index on Monday.
Among significant market players, Taiwan Semiconductor Manufacturing Co. (TSMC) saw a modest increase of 0.42 percent, closing at NT$2,380.00, as the stock remained in a consolidation phase. Huang mentioned that strong buying in other large-cap electronics stocks significantly boosted the Taiex, with investors re-establishing their AI positions following a recent sell-off.
IC packaging and testing firm ASE Technology Holding Co. experienced a 7.69 percent rise to NT$630.00. Memory chip suppliers Nanya Technology Corp. and Winbond Electronics Corp. both reached the daily increase limit of 10 percent, closing at NT$502.00 and NT$179.50, respectively. United Microelectronics Corp., a smaller contract chipmaker, gained 6.03 percent, ending at NT$123.00.
In the AI-related stocks sector, Delta Electronics Inc., a power management solutions provider, surged 10 percent to NT$1,815.00. Yageo Corp., a leading multilayer ceramic capacitor maker, gained 6.11 percent, closing at NT$573.00. AUO Corp., a flat-panel maker, jumped 10 percent to NT$27.00 following reports of TSMC acquiring two of its plants for over NT$30 billion to expand integrated circuit assembly capacity.
Non-tech stocks mostly mirrored the Taiex's movement. Fortune Electric Co. rose 2.76 percent to NT$671.00, while Rexon Industrial Corp. gained 2.63 percent to NT$31.20. Conversely, Formosa Plastics Corp. dropped 0.36 percent to NT$55.60, and Nan Ya Plastics Corp. decreased 1.60 percent, ending at NT$185.00.
The financial index increased by 0.6 percent, with Cathay Financial Holding Co. rising 1.61 percent to NT$101.00 and Fubon Financial Holding Co. climbing 1.18 percent to NT$128.50. Huang advised caution as the Taiex faced technical resistance near the 45,000-point level. He emphasized the importance of monitoring U.S. inflation data, due Wednesday, for further insights into the Federal Reserve's next steps.
According to the Taiwan Stock Exchange, foreign institutional investors were net buyers, acquiring NT$51.71 billion worth of shares on the main board Monday.