TAIPEI (CNA) — Shares in Taiwan soared more than 170 points on Jan. 9 to top the 9,700-point mark, as investors took their cue from a strong rally on U.S. markets overnight amid eased concerns over trade tension between the United States and China, dealers said.

The bellwether electronics sector led the upturn with large-cap stocks, such as contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC), attracting bargain hunting after recent consolidation, while buying also spread to the old economy sector, in particular, petrochemical stocks, pushing the broader market even higher, they said.

The weighted index on the Taiwan Stock Exchange (TWSE), or the Taiex, finished up 174.71 points, or 1.83 percent, at 9,738.31, after moving between 9,584.63 and 9,741.64, on turnover of NT$125.89 billion (US$4.08 billion).

The market opened up 0.23 percent, a reflection of the gains posted on U.S. markets where the Dow Jones Industrial Average closed up 1.09 percent and the tech-savvy Nasdaq index ended up 1.08 percent overnight amid optimism over on-going U.S.-China trade talks, dealers said.

Such an upbeat mood resulted from a tweet by U.S. President Donald Trump on Tuesday, saying: “Talks with China are going very well!” In addition, U.S. Commerce Secretary Wilbur Ross told CNBC on Monday that the two global powers could reach a settlement “they can live with, and that addresses all the key issues.”

Buying on the local main board accelerated as local investors were encouraged to buy large-cap stocks at a time other regional markets such as Shanghai, Hong Kong, Tokyo, and Seoul, reacted positively to the U.S. rally, they said.

“Judging from the latest information on the talks, I think the U.S. and China are moving toward a resolution of their disputes,” Ta Ching Securities analyst Jerry Chen said.

“Local investors simply seized on the favorable news to hunt bargains today,” Chen said, “The gains enjoyed by other regional markets even boosted the buying here further with a focus on market heavyweights, which helped the Taiex jump over the 9,700-point mark and expanded daily trading volume.”

Among gaining large-cap stocks, TSMC, the most heavily weighted stock on the local market, rose 2.13 percent to close at NT$215.50 with 46.21 million shares changing hands. Led by TSMC, the bellwether electronics sector ended up 1.81 percent, and the semiconductor sub-index closed up 2.06 percent.

In addition to TSMC, a processor supplier to Apple Inc., other “Apple concept stocks” also moved higher after Apple CEO Tim Cook said the company’s “ecosystem has never been stronger.”

iPhone assembler Hon Hai Precision Industry Co. rose 1.90 percent to close at NT$69.90, Catcher Technology Co., a metal casing supplier to Apple, added 3.64 percent to end at NT$213.50 and shares in Largan Precision Co., a smartphone camera lens supplier to Apple, closed up 6.04 percent to close at NT$3,335.00.

Chen said Wednesday’s buying was seen across the board with major old economy stocks also in focus.

In the old economy sector, shares in food brand Uni-President Enterprises Corp. rose 2.71 percent to close at NT$72.10, and Taiwan Cement Corp. gained 2.25 percent to end at NT$36.35, while Formosa Chemicals & Fibre Corp. added 1.40 percent to close at NT$108.50, and Formosa Petrochemical Corp. rose 6.05 percent to end at NT$114.00 on rebounding crude oil prices overnight.

Bargain hunters also picked up big financial stocks with Cathay Financial Holding Co. up 1.77 percent to close at NT$45.95, and Fubon Financial Holding Co. up 2.95 percent to end at NT$47.05.

“Due to today’s gains, the main board has moved closer to the next technical resistance ahead of the 60-day moving average of 9,743 points,” Chen said. “I am afraid investors will lock in profits after the surge.”

Chen also urged local investors to pay close attention to the current earnings seasons in Taiwan and the U.S. “since many firms might show a cautious business outlook, which could place pressure on their share prices.” According to the TWSE, foreign institutional investors bought a net NT$12.11 billion worth of shares on the main board Wednesday.

By Frances Huang