TAIPEI — Shares on the Taiwan Stock Exchange closed above the 7,800-point level yesterday on the back of further fund inflows as foreign investors became more willing to take risks after the United States escaped the much-hyped fiscal cliff after the passage of a needed budget bill, dealers said.
Select large-cap stocks, in particular Taiwan Semiconductor Manufacturing Co. (TSMC), remained spotlighted in buying and boosted daily turnover as foreign institutional investors rushed to build up their holdings, the dealers said.
The weighted index ended up 57.62 points, or 0.74 percent, at 7,836.84 after fluctuating between 7815.29 and 7,855.16 on turnover of NT$104.91 billion.
The market opened up 0.61 percent on follow-through buying in reflection of an overnight rally on Wall Street after Washington averted the fiscal cliff, which refers to sizable tax increases and spending cuts that could have triggered a recession, the dealers said.
Momentum continued, helping the market move above the 7,800-point mark throughout the session, as certain market heavyweights kept luring foreign institutional buying, they said. TSMC Goes Above NT$100 Due to a strong showing of the tech-heavy NASDAQ index overnight, TSMC continued its uptrend soon after the market opened, ending up 1.41 percent at NT$101.00. It was the first time the stock had breached the NT$100.00 mark in almost 12 years.
“TSMC has become an important indicator to the broader market, as the stock is always attractive to foreign investors,” Huang said. “I suspect foreign investors served as the major buyers today.”
Led by the gains posted by TSMC, rival United Microelectronics Corp. added 4.66 percent to close at NT$12.35, while integrated circuit packaging and testing service provider Advanced Semiconductor Engineering Inc. rose 2.49 percent to end at NT$26.80.
In the old economy sector, Nan Ya Plastics Corp. gained 4.24 percent to close at NT$59.00, while Chang Hong Construction Co. ended up 3.95 percent at NT$89.50.
Huang said that by taking into account the Taiwan dollar appreciation, investors should keep a close eye on property stocks, which have been under inflationary pressure.
The plastics and chemical sector scored the highest gains among the eight major sectors of the market, finishing up 1.8 percent. Construction shares rose 1.6 percent, paper and pulp stocks rose 1.1 percent, textiles added 0.8 percent, and the machinery and electronics sector closed up 0.5 percent.
Financials gained 0.3 percent and foodstuffs added 0.1 percent, while the cement sector ended down 0.1 percent.