Taiwan stock market closes higher boosted by Nasdaq surge

By Sandra Chuang, The China Post

The Taiwan stock market yesterday closed sharply higher, boosted by a surge in the U.S. Nasdaq overnight and positive government comments about the domestic economy. The index rose 155.38 points, or 3.1 percent, to close at 5,220.44, on a daily turnover of NT$79.9 billion, the highest level since April 20.

The market rose 64.42 points at the opening, following the rise in U.S. technology titles overnight. It then extended its gains as investors were encouraged by fresh incentives announced by the Ministry of Finance and President Chen Shui-bian. A solid interest in stock purchases emerged as the session progressed, helping the index to close above 5,200 points.

“The sharp gains suggest that investors have shrugged off concerns over the recent market performance and became increasingly convinced that positive policies might come out of an economic development conference chaired by President Chen,” said a dealer.

Technology shares, especially electronics titles, were mostly firmer, with sentiment bolstered by the overnight upturn in U.S. semiconductor-related shares. DRAM chip manufacturer Winbond Electronics added 5.3 percent while chipset designer VIA Technologies gained 6.7 percent.

Taiwan Semiconductor Manufacturing Corp. (TSMC) shares, in particular, edged higher on a report that the second quarter will mark a trough for the company. TSMC rose 2.8 percent to close at NT$93.5.

Financial shares also rose, led by the gains in electronics shares. Some investors increased their share holdings on expectations of the passage of a financial holding company law. Traditional shares were modestly higher, but buying interest was thin as investors focused more on heavyweight shares yesterday.