Local shares close up at 9,240.6 points at 6-year high as electronics boom
The China Post news staff June 18, 2014, 12:00 am TWN
TAIPEI, Taiwan -- Shares in Taiwan on Tuesday closed at a six-year high of 9,240.6 points as buying rotated to the bellwether electronics sector, amid continued optimism toward the global semiconductor business in the second half.
The weighted index on the Taiwan Stock Exchange ended up 37.67 points, or 0.4 percent, at 9,240.60, after moving between 9,200.86 and 9,249.87, on turnover of NT$100.54 billion (US$3.35 billion).
Large-cap IC Stocks' Major Players
The Central News Agency (CNA) reported that shares in Taiwan closed higher yesterday as buying rotated to the bellwether electronics sector, in particular integrated circuit heavyweights, amid continued optimism toward the global semiconductor business in the second half of this year, dealers said.
Interest also focused on Apple concept stocks, as investors still had high hopes that the next generation of iPhones and iPads, which are likely to hit the market later in the year, will boost local suppliers' shipments, the dealers said.
Despite the uptrend, the local market remained in consolidation mode ahead of a two-day policymaking meeting of the U.S. Federal Reserve scheduled to kick off later in the day, they added.
The market opened up 0.22 percent on follow-through buying from a session earlier, and momentum accelerated as large-cap high-tech stocks such as IC designer MediaTek Inc. (聯發科技) and contract chip-maker Taiwan Semiconductor Manufacturing Co. (TSMC,台積電) attracted interest on their sound fundamentals, the dealers said.
The financial sector got a boost from late-session bargain hunting to further lift the broader market at the close, they said.
"The local equity market has been moving forward gradually in recent sessions despite some sporadic profit-taking emerging. This movement indicates that the local market has been technically healthy," President Securities analyst Vickie Hsieh said.
Hsieh said the bellwether electronics sector served as an anchor to the broader market's upward movement throughout the session. The electronics sub-index closed up 0.70 percent.
"Thanks to certain IC stocks, the entire electronics sector remained highlighted today. Many investors remained upbeat about the market outlook for the second half of this year," Hsieh said.
MediaTek Outruns Broader Market
MediaTek rose 2.72 percent to close at NT$510.00 on solid demand for the company's smartphone chips from Chinese buyers, while TSMC, the most heavily weighted stock in the local market, gained 0.81 percent to end at NT$125.00.
Inotera Memories Inc. (華亞科技) added 3.81 percent to close at NT$54.50 on expectations that a tight supply will boost DRAM prices for the third quarter by 5-10 percent from a quarter earlier.
"Local Apple suppliers also attracted buying, led by Hon Hai Precision Industry Co. (鴻海精密) and Largan Precision Co. (大立光電) on hopes that new Apple devices will strengthen their bottom lines," Hsieh said.
Hon Hai, the world's largest contract electronics maker, which assembles iPhones and iPads, rose 1.40 percent to close at NT$94.00, and Largan gained 2.46 percent to end at NT$2,085.00.
In the financial sector, market laggard Cathay Financial Holding Co. (國泰金控) added 0.64 percent to close at NT$46.85, while CTBC Holding Co.(中信金控) rose 0.77 percent to end at NT$19.55.
"The local market still faces stiff technical resistance ahead of 9,300 points to prevent investors from buying more," Hsieh said. "In addition, cautious sentiment before the Fed's conclusion also drove many investors to the sidelines."
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