Local shares boosted by Wall Street gains
Shares in Taiwan closed higher Friday as investors here were encouraged by the gains posted on Wall Street overnight and picked up bargains after the market had lost ground the previous two sessions, dealers said.
Taiwan Semiconductor Manufacturing Co. (TSMC, ), the world’s largest contract chipmaker, staged a technical rebound following a 1.03 percent rise in its American depositary receipts ( ADRs) in the U.S. market overnight, helping drive the broader market higher, dealers said.
The financial sector extended gains from a session earlier to also lend support to the market after life insurance companies reported an improvement in their bottom lines for the first quarter, they said.
The weighted index on the Taiwan Stock Exchange ended up 49.66 points, or 0.51 percent, at 9,617.70, after moving between 9,582.84 and 9,648.34, on turnover of NT$91.18 billion (US$2.92 billion).
The market opened up 0.65 percent in reaction to Wall Street’s gains overnight, and buying accelerated with TSMC and financial stocks steaming ahead, pushing the index to the day’s high, dealers said.
With the index moving closer to the nearest technical resistance at around 9,700 points, however, some investors starting selling their holdings to lock in gains built earlier in the session, capping the index’s rise at the close, they said.
TSMC Stabilizes Broader Market
“TSMC played a role in stabilizing the broader market, which suffered losses the past few days,” Marbo Securities Investment Consulting analyst Chang Chih-cheng said.
“But the gains posted by TSMC failed to boost turnover significantly. It was not easy for the local market to clear the technical hurdles above the 9,700- point mark with daily trading volume remaining under NT$100 billion,” Chang said.
TSMC, t he most heavily weighted stock on the market, rose 2.80 percent to close at NT$ 147.00, with 33.82 million shares changing hands, after U. S. chip maker Intel Corp.’ s bid to acquire smaller rival Altera Corp. broke down.
The termination of the takeover talks eased market concerns that Altera would shift its orders to Intel from TSMC once the acquisition was completed, prompting investors here to buy the Taiwanese chip maker’s shares Friday, dealers said.
“The failure of the local bourse to see its turnover expand significantly was also because of the limited gains posted by other high-tech heavyweights,” Chang said.
“Investors have been closely watching the ongoing earnings season on Wall Street and were reluctant to chase prices for the moment.”
Among the gaining electronics stocks, Hon Hai Precision Industry Co. ( ), which assembles iPhones and iPads, rose 0.11 percent to close at NT$93.10, and Largan Precision Co. (
), which supplies smartphone camera lenses to Apple Inc., added 0.94 percent to end at NT$2,695.00.
The financial sector closed up 0.56 percent after most financial holding companies that own large life insurance units posted higher earnings in the first quarter.
Among them, Shin Kong Financial Holding Co. ( ) gained 2.66 percent to close at NT$9.25 after posting a 140 percent increase in net profit for the first quarter.
Cathay Financial Holding Co. ( ) rose 0.80 percent to end at NT$ 50.60 after recording a more than 46 percent increase in net income over the same period.