Stocks rise as MediaTek, China Steel lead gainers

Stocks rose, led by MediaTek Inc (聯發科技) after the nation's second-largest chip designer posted second-quarter profit that almost doubled as sales surged.

TAIEX gained 69.50, or 1.4 percent, to 4,887.43. More than five stocks rose for every two that fell. Shares worth NT$65.33 billion (US$1.94 billion) changed hands.

MediaTek surged by its daily limit of 6.8 percent to NT$453.

Profit climbed nine-tenths to NT$2.6 billion as sales of chips used in DVD and other disc players more than doubled.

"A lot of investors underweight on electronics stocks are waiting for companies to release earnings results in case of any unexpected losses before buying," said Bryan Chiang, who helps manage NT$1.8 billion in stocks at Invesco Taiwan Ltd (景順投信).

"MediaTek's results meet expectations. Investors feel more secure about buying its shares."

China Steel Corp (中鋼) added NT$0.20, or 1.3 percent, to NT$16 after a local Chinese-language newspaper reported that Taiwan's largest steelmaker may raise its profit forecast for the year a second time. The company will raise prices for the fourth quarter when it meets today.

Cathay Financial Holding Co (國泰金控) slid NT$2.40, or 5.2 percent, to NT$44.10, extending Tuesday's 6.8 percent drop.

HannStar Display Corp (瀚羽 彩

晶) rose NT$0.80, or 4.4 percent, to NT$19. The flat-panel display maker received government approval to invest US$12.5 million in a product-assembling plant in China.

AU Optronics Corp (友達光電) rose NT$0.90, or 3.5 percent, to NT$27 after media reports that the company received an order from Hewlett-Packard Co for displays for notebook computers.

Grand Commercial Bank (萬通銀行) rose NT$0.30, or 3.5 percent, to NT$9. It plans to spend as much as NT$300 million buying back its own shares starting Wednesday.

Advanced Semiconductor Engineering Inc (日月光) rose NT$0.70, or 3.5 percent, to NT$20.60. The chip packager said it plans to buy back 160 million shares which it will issue to its employees as stock options.

Everlight Electronics Co (億光電子) rose NT$2.10, or 6.7 percent, to NT$33.30. The light-emitting diode maker forecasts sales in August may reach a record after it received more than NT$400 million of orders.

Taiwan Fire & Marine Insurance Co (台灣產物保險) rose NT$0.35, or 3.1 percent, to NT$11.75. The non-life insurer plans to spend as much as NT$68 million, throught Oct. 13, to buy back 4 million of its shares, or 1.6 percent of its outstanding stock.