Shares in Taiwan rose again Tuesday as contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC) continued its momentum in the wake of a further upturn by semiconductor stocks on U.S. markets overnight, dealers said.
Buying was also seen among old economy stocks, in particular in the transportation sector, but many investors stayed cautious ahead of the release of U.S. inflation data for October later in the week, dealers said.
The Taiex, the Taiwan Stock Exchange’s benchmark weighted index, ended up 124.03 points, or 0.94 percent, at 13,347.76 after moving between 13,274.91 and 13,389.25. Turnover totaled NT$222.71 billion (US$6.96 billion).
The market opened up 0.39 percent on follow-through buying from Monday and the momentum continued, particularly in the electronics sector, after a 1.31 percent rise in the Dow Jones Industrial Average and a 2.18 percent surge in the Philadelphia Semiconductor Index overnight.
Buying later spread to select old economy stocks to push the Taiex to the day’s high before some investors shifted to the sell side to limit the upturn, dealers said.
“Judging by the market’s gains in recent sessions, it seemed investors at home and abroad have left behind concerns over an aggressive Federal Reserve, at least for now, as they became more willing to pick up bargains,” Mega International Investment Services Corp. analyst Alex Huang said.
Huang said tech sector stocks were particularly in demand after being battered in recent weeks by rising interest rates.
TSMC, the most heavily weighted stock in the local market, pushed the broader market higher by rising 2.31 percent to close at NT$399.00, contributing about 90 points to the Taiex’s increase on its own.
The electronics index and the semiconductor sub-index moved higher by 1.18 percent and 1.64 percent, respectively.
“Still, TSMC failed to jump over the high technical hurdles ahead of the NT$400 mark as foreign institutional investors stayed jittery about rising tensions across the Taiwan Strait and current inventory adjustments in the global semiconductor industry,” Huang said.
Despite TSMC’s strength, semiconductor stocks appeared mixed. United Microelectronics Corp. a smaller contract chipmaker, closed 0.25 percent higher at NT$40.15, but Powership Semiconductor Manufacturing Corp., another small contact chipmaker, fell 2.29 percent to close at NT$32.00.
Smartphone IC designer MediaTek Inc. ended unchanged at NT$620.00, while IC packaging and testing services provider ASE Technology Holding Co. lost 0.12 percent to close at NT$84.40.
Also in the electronics sector, iPhone assembler Hon Hai Precision Industry Co. ended unchanged at NT$100.00 after it announced it would spend US$170 million to take a stake in American electric pick-up truck maker Lordstown Motors Corp. through a private placement.
Power management solution provider Delta Electronics Inc. gained 0.37 percent to close at NT$274.00.
“Shipping stocks staged a strong technical rebound on hopes that the upcoming Christmas holiday will boost shipping demand,” Huang said.
“Many investors have also embraced high hopes that China will ease COVID-19 restrictions in the near term, which would push up demand further.’
The transportation sector, in which major shipping stocks are traded, rose 1.74 percent.
Evergreen Marine Corp., the largest container cargo shipper in Taiwan, closed 2.79 percent higher at NT$147.50, and rivals Yang Ming Marine Transport Corp. and Wan Hai Lines Ltd. gained 1.77 percent and 0.57 percent, respectively, to end at NT$63.40 and NT$70.40.
In addition, China Airlines rose 1.73 percent to close at NT$17.60, and EVA Airways gained 3.67 percent to end at NT$25.40 on eased border controls in Taiwan.
Elsewhere in the old economy sector, Taiwan Cement Corp. rose 2.10 percent to close at NT$31.65, and textile brand Far Eastern New Century Corp. added 1.08 percent to end at NT$32.80.
In the financial sector, which rose 0.53 percent, Cathay Financial Holding Co. added 0.38 percent to close at NT$39.70, and Fubon Financial Holding Co. gained 0.76 percent to end at NT$53.20.
“The U.S. October consumer price index will be a key issue for global markets as inflation is expected to continue to dictate the Fed’s policy,” Huang said. “In addition, the market has also been watching the mid-term elections in the U.S. (on Tuesday).”
According to the Taiwan Stock Exchange, foreign institutional investors bought a net NT$9.09 billion in shares on Tuesday.
Source: Focus Taiwan News Channel