TAIPEI — A planned light rail system on the outskirts of Taipei boosted old-economy stocks on the Taiwan Stock Exchange yesterday and helped the weighted index close slightly higher.
The Council for Economic Planning and Development approved on Monday the New Taipei City Government’s plan to build a light rail system that will serve as an extension from the MRT Tamsui Station further into the town. Construction on the NT$15.3 billion system is scheduled to begin at the end of 2013 and is expected to start service in 2018. News of the project’s approval pushed industrial stocks higher, with construction shares gaining 1.5 percent and textile stocks rising 1.7 percent, the most of any of the market’s eight major sectors. The broader weighted index closed up 16.98 points, or 0.22 percent, at 7,738.64, after moving between 7,763.97 and 7,703.23. Turnover was NT$83.35 billion.
A total of 2,807 stocks closed up, 2,087 finished down and 491remained unchanged. In the electronics sector, Taiwanese smartphone vendor HTC, chip designer MediaTek Inc., and handheld device camera lens supplier Largan Precision Co. brushed off pressure from lower-than expected sales reports in December to help lift high-priced electronics stocks.
MediaTek rose 3.1 percent to close at NT$312, and HTC gained 1.63 percent to end at NT$281.
Largan Precision rose 0.54 percent to NT$742 and metal casing supplier Foxconn Technology Co. rose 0.68 percent to close at NT$88.30. Shares in the broader machinery and electronics sector closed up 0.2 percent. Financial stocks gained 0.4 percent, while paper and pulp shares rose 0.2 percent.
The cement sector finished down 0.1 percent, plastics and chemical shares lost 0.5 percent, and food shares closed down 0.3 percent. Market analyst Chen Kuan-jung said he expects Taiwan’s market to go into consolidation mode in the coming days, citing the high number of sell orders on the futures market and the net selling of foreign institutional investors for three straight trading days. He predicted that electronics stocks will remain relatively weak because the industry is entering its traditional low season, and iPhone shipment forecasts have been revised downward.