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Local shares up 0.26 percent, hit 33-month high

TAIPEI, Taiwan -- Mainly boosted by foreign institutional buying, shares in Taiwan on Tuesday continued gains and closed higher by 23.87 points, or 0.26 percent, at a 33-month high of 8,873.15.

The Central News Agency (CNA) yesterday also attributed the strong performance of shares in Taiwan to large-cap high-tech stocks which extended their gains after share prices on American stock exchanges rose overnight.

Led by semiconductor and optoelectronics stocks, the bellwether electronics sector benefited from the gains posted by the tech-heavy Nasdaq index to push the index higher, according to CNA.

Buying interest was also sustained by a comment by U.S. Federal Reserve Chair Janet Yellen that the central bank will continue to support the economy "for some time to come," they added.

The weighted index on the Taiwan Stock Exchange ended up 23.87 points, or 0.26 percent, at 8,873.15, after moving between 8,826.16 and 8,873.15, on turnover of NT$90.39 billion (US$2.97 billion).

The market opened down 1.94 points and quickly hit the day's low as investors pocketed the gains they had built a day earlier, but bargain hunters then turned active to push the index into positive territory, dealers said.

"After the local market closed above the 8,800-point mark yesterday, many investors became wary of a possible pullback so the market weakened initially," President Securities analyst Vickie Hsieh said.

"But as the electronics sector pushed higher, bargain hunters were encouraged to buy, helping the market recoup its earlier losses at the close," Hsieh said.

Hsieh said Yellen's remarks overnight eased investor fears to some extent, prompting them to think the Fed will continue to inject funds into the market and maintain ample liquidity.

Foreign Institutional Buying Remains Strong

"Judging from the gains posted by market heavyweights, I suspect buying largely came from foreign institutional investors," Hsieh said.

According to the TWSE, foreign institutional investors were net buyers of NT$8.94 billion in local shares.

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