Do­mes­tic shares con­tinue to rise as Wall Street re­bounds

The China Post - - TAIWAN BUSINESS -

Shares in Tai­wan rose for the fourth con­sec­u­tive ses­sion Fri­day as in­vestors took cues from a strong re­bound on Wall Street overnight, deal­ers said.

Buy­ing was seen across the board, with large cap stocks in fo­cus, push­ing the weighted in­dex past the 8,000 point mark, deal­ers said.

The bell­wether elec­tron­ics sec­tor led the up­turn on the back of a strong show­ing by high-tech stocks in the U.S. mar­ket, they said.

The weighted in­dex on the Tai­wan Stock Ex­change closed up 194.63 points, or 2.48 per­cent, at 8,019.18, af­ter mov­ing be­tween 7,923.77 and 8,039.76. Turnover to­taled NT$103.83 bil­lion (US$3.21 bil­lion) dur­ing the ses­sion.

The mar­ket opened up 1.27 per­cent in a knee-jerk re­ac­tion to a 2.27 per­cent in­crease on the Dow Jones In­dus­trial Av­er­age overnight.

The mo­men­tum ac­cel­er­ated, vault­ing the in­dex past 8,000 points as in­vestors rushed to raise their hold­ings in the elec­tron­ics sec­tor af­ter the tech-heavy NAS­DAQ in­dex rose 2.45 per­cent overnight, deal­ers said.

In­ter­na­tional Crude Oil

Prices Re­bound

The buy­ing con­tin­ued through­out the ses­sion, ex­tend­ing to other sec­tors and petro­chem­i­cal shares in par­tic­u­lar, which ben­e­fited from the strong re­bound of in­ter­na­tional crude oil prices overnight, deal­ers said.

“The bet­ter-than-ex­pected eco­nomic growth in the United States for the sec­ond quar­ter and a sharp re­bound of crude oil prices made many in­vestors at home and abroad feel bet­ter about the econ­omy,” Ta Ching Se­cu­ri­ties an­a­lyst Andy Hsu said. “That’s why the global eq­uity mar­kets started climb­ing out of the re­cent dol­drums.”

The U.S. on Thurs­day re­ported 3.7 per­cent eco­nomic growth for the April-June pe­riod, beat­ing the 2.3 per­cent forecast. U.S. crude prices sub­se­quently jumped more than 10 per­cent Thurs­day to US$42.56 per bar­rel.

“Such pos­i­tive eco­nomic news made many in­vestors happy and they seized the strong gains on Wall Street to pick up bar­gains in the lo­cal eq­uity mar­ket, tak­ing ad­van­tage of the re­cent sell-off,” Hsu said.

Elec­tron­ics Shares

Been Over­sold

He said that since the lo­cal elec­tron­ics sec­tor had been over­sold, buy­ing there ap­peared more vis­i­ble, push­ing up the elec­tron­ics sub-in­dex 2.31 per­cent by the close.

“De­spite the latest gains, the lo­cal high- tech sec­tor re­mains cheap, Hsu said. “The up­trend in the sec­tor may con­tinue in the next few ses­sions.”

Among the gain­ing elec­tron­ics stocks, in­te­grated cir­cuit de­signer Me­di­aTek Inc. ( ) rose by the max­i­mum daily 10 per­cent to close at NT$253.00, and IC pack­ag­ing and test­ing ser­vices provider Ad­vanced Semi­con­duc­tor En­gi­neer­ing Inc. gained 5.00 per­cent to end at NT$33.60.

Hon Hai Pre­ci­sion In­dus­try Co. ( ), an as­sem­bler of iPhones and iPads, rose 4.73 per­cent to close at NT$88.60, and Pe­ga­tron Corp. ( ) , which as­sem­bles the iPhone 6, added 4.24 per­cent to end at NT$86.00 af­ter it was re­ported that Ap­ple Inc. will un­veil its next-gen­er­a­tion iPhone on Sept. 9.

Lar­gan Re­turns to

NT$3,000 Mark

Lar­gan Pre­ci­sion Co. ( ), a smart­phone cam­era lens sup­plier to Ap­ple, rose 1.35 per­cent to close at NT$3,000.00, re­turn­ing to that mark for the first time since Aug. 13.

The stock, the most ex­pen­sive in the lo­cal mar­ket, was hard hit by the tur­moil in the global eq­uity mar­kets.

The petro­chem­i­cal sec­tor closed up 5.14 per­cent on the higher crude oil prices, with Formosa Plas­tics Corp. ( ) adding 5.38 per­cent to fin­ish at NT$68.50 and Formosa Chem­i­cals & Fi­bre Corp. ( ) ris­ing 7.92 per­cent to end at NT$69.50.

“It’s good that the in­dex closed above the psy­cho­log­i­cal 8,000- point mark, im­prov­ing mar­ket sen­ti­ment,” Hsu said. “But the main board is ex­pected to face stiff tech­ni­cal re­sis­tance ahead of 8,100 points. Un­less turnover in­creases to about NT$120 bil­lion, it would not be easy to clear that hur­dle.”

CNA

An in­vestor looks at stock in­dices, yesterday. Af­ter re­tain­ing its 10-year mark on Thurs­day at 7794, the TAIEX surged another 194 points yesterday and re­gained the 8,000 mark. Af­ter a large drop on Mon­day, Tai­wan’s mar­kets ral­lied four con­sec­u­tive times to close out a week of volatile trad­ing.

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