Taiwan stocks rise to two-month high

First Steamship Co., which provides transportation services for raw materials such as cement and coal, rose NT$2.80, or 2.9 percent, to NT$98.10.

Katherine Yeh, an analyst at Yuanta Securities Co., raised her share-price forecast for First Steamship to NT$115 from NT$93, citing higher freight rates. Yeh maintained her “buy” recommendation in a report dated yesterday.

Elsewhere, China Airlines, Taiwan’s largest carrier, gained 10 cents, or 0.7 percent, to NT$13.75. Chairman Philip Wei was replaced by company President Ringo Chao at a board meeting yesterday.

In a related story, the Bureau of Labor Insurance under the Council of Labor Affairs announced yesterday its investment of the labor insurance fund, totaling NT$20.5 billion, has generated NT$14,8 billion in earnings over the past three years, translating into a return of investment of over 70 percent.

The 72.62 percent yield, made from Oct. 1, 2004 to Sept. 30, 2007, even beat that of the TAIEX, which generated a yield of 61.46 percent during the same period.

The money was managed by seven asset management firms. The labor insurance bureau yesterday signed with the seven firms to expand the investment to NT$44.9 billion.

“The asset management firms have to make yield of 7 percent each year, or 21 percent over three years, for us to extend the contract,” the bureau said. “It turns out they made much more.”

The bureau attributed the huge return of investment to a rally of Taiwan stocks this year, as well as careful monitoring of the seven firms as they managed the fund.

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