Taiwan stock market rebounds on suspected gov’t support

By Sandra Chuang, The China Post

The market rebounded yesterday on the back of suspected support by the government and a steadier local currency. The index rose 15.54 points to close at 5,095.26, while the daily turnover expanded from Monday’s NT$33 billion to NT$55.1 billion. The index opened slightly higher and was quickly pushed up above 5,100 points on strong buying reportedly by government-related funds, which entered the market in order to cap the negative impact of yesterday’s sharp deprecation of local currency on the stock market.

However, the market began to erase earlier gains after the index peaked at 5,174.45 points, as many investors still choose to retreat to the sidelines with their pessimistic sentiment about the island’s weak economic outlook.

“Some buyers were encouraged by positive reports about the sharp fall in local currency Monday,” said a broker. But most brokers believed export-oriented shares, especially those in the technology sector, gained the most benefit in yesterday’s market.

The shares of computer makers were one of the best performers, with Quanta Computer rising 2.8 percent to close at NT$112, and Acer gaining 2.6 percent to stand at NT$20.

Financial shares generally moved higher as the gains in high-tech shares helped to boost investors’ interest in other sectors.

Traditional shares also rebounded slightly today but some shares were facing selling pressure on the weaker NT dollar. Import-oriented shares, such as food shares, fell sharply today, with Uni-President Enterprises shedding 2.3 percent to end at NT$14.65.