Taiwan shares end higher, led by TSMC

Shares in Taiwan extended their momentum from a session earlier to move higher Tuesday on the back of a rally by contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC), dealers said.

 

But while the bellwether electronics sector drove the broader market higher, non-tech stocks appeared mixed as rotational buying left them behind, they said.

 

The Taiex, the Taiwan Stock Exchange’s benchmark index, ended up 126.06 points, or 0.72 percent, at 17,541.36, after moving between 17,433.10 and 17,581.52. Turnover totaled NT$393.25 billion (US$14.16 billion).

 

The market opened up 0.10 percent and momentum accelerated quickly as TSMC got a boost from the news that United States-based client Advanced Micro Devices Inc. (AMD) won orders from Meta (Facebook) to supply the Epyc processor, which uses TSMC’s technologies, for Meta’s data center, dealers said.

 

TSMC’s strength spread to other tech stocks, including smaller contract chipmaker United Microelectronics Corp. (UMC), to vault the Taiex past technical hurdles ahead of 17,500 points, they said.

 

The electronics sector rose 1.15 percent, and the semiconductor sub-index gained 1.35 percent.

 

“Market interest swung back to large cap tech stocks today as investors were encouraged by the AMD news,” Mega International Investment Services Corp. analyst Alex Huang said.

 

“TSMC’s lead over its peers in high-end technologies has put it among the ‘metaverse concept’ stocks. That’s why buying in the stock emerged after the positive AMD lead emerged as enthusiasm over the metaverse concept has been growing,” Huang said.

 

The metaverse concept has been talked up by Meta CEO Mark Zuckerberg since July. It refers to a digital world where people can move between devices and communicate in a virtual environment.

 

After a 2.64 percent increase in its American depositary receipts (ADRs) overnight, TSMC rose 1.50 percent to close at NT$611.00. TSMC’s gains alone contributed about 75 points to the Taiex’s increase Tuesday.

 

Interest in TSMC drove buying in other large cap tech stocks. UMC closed 0.96 percent higher at NT$63.10, and power management solution provider Delta Electronics Inc. gained 2.50 percent to close at the day’s high of NT$266.00.

 

Bucking the upturn, integrated circuit designer MediaTek Inc. lost 0.20 percent to close at NT$978.00 after hitting NT$1,000.00, and IC packaging and testing services provider ASE Technology Holding Co. fell 0.47 percent to end at NT$105.00.

 

Also in the electronics sector, iPhone assembler Hon Hai Precision Industry Co. gained 0.47 percent to close at NT$108.00, and Largan Precision Co., a supplier of smartphone camera lenses to Apple Inc., rose 0.49 percent to end at NT$2,060.00.

 

“Today’s expanded turnover resulted from interest in these tech heavyweights, although many of them pulled back from earlier highs,” Huang said. On Monday, turnover was NT$381.55 billion.

 

“With funds pouring into tech stocks, the non-tech sector was largely mixed, and some of them even reversed their gains seen yesterday,” Huang said.

 

In the transportation sector, which fell 0.75 percent, Evergreen Marine Corp., the largest container shipper in Taiwan, lost 1.21 percent to close at NT$122.50, and rival Yang Ming Marine Transport Corp. fell 1.69 percent to end at NT$116.00.

 

But buying rotated to airline stocks, with EVA Airways rising 5.96 percent to close at NT$24.90 and China Airlines gaining 4.76 percent to end at NT$22.00.

 

Elsewhere in the old economy sector, Formosa Plastics Corp. ended 2.27 percent lower at NT$107.00, while Nan Ya Plastics Corp. rose 0.12 percent to end at NT$85.80, and textile brand Far Eastern New Century Corp. added 1.53 percent to close at NT$29.90.

 

China Steel Corp., Taiwan’s largest steel maker, rose 0.29 percent to end at NT$34.50, but China Steel Structure Corp. lost 1.83 percent to close at NT$53.50.

 

“How the Taiex will move will depend on TSMC’s performance,” Huang said. “But I think the room for TSMC to rise further will be limited as the stock faces stiff technical resistance ahead of NT$620.00.”

 

According to the TWSE, foreign institutional investors bought a net NT$19.61 billion in shares Tuesday.

 

Source: Focus Taiwan News Channel

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