President's cross-strait comments lift China Airlines

Taiwan stocks gained yesterday for the first day in four, led by China Airlines Co (華航), on optimism the nation will establish direct transport links with China after President Chen Shui-bian (陳水扁) said he favors boosting cross-strait ties.

The TAIEX gained 72.42, or 1.6 percent, to close at 4,524.87. Almost nine stocks rose for every two that dropped. The total value of trade was NT$62 billion (US$1.8 billion), 21 percent below the three-month daily average.

China Airlines, Taiwan's largest carrier, climbed NT$0.75, or 5.1 percent, to NT$15.60. Evergreen Marine Corp, which runs the world's fourth-largest shipping line by capacity, gained NT$1.50, or 6.9 percent, to NT$23.10.

"There's a big chance we'll have direct links by the end of the year," said James Wang, who manages NT$1.5 billion in stocks at International Investment Trust Co (國際投信). He's buying shares of transport-related companies and digital-camera makers.

Taipei has already approved in principle charter flights to Shanghai, which will require a stopover in Hong Kong or Macau and will operate between Jan. 26 and Feb. 10.

"Consultation and promotion of direct transportation links, as well as exchanges on other relevant economic issues, could constitute a first step forward and set the stage for further economic and cultural exchange," Chen said on Wednesday.

Arima Computer Corp (華宇電腦) rose NT$0.25, or 2.2 percent, to NT$11.50. The maker of notebook computers for customers such as Hewlett-Packard Co may receive orders for as many as 800,000 units from NEC Corp this year, double last year's shipments to Japan's biggest maker of personal computers, the DigiTimes newspaper reported.

Chunghwa Picture Tubes Ltd (中華映管) rose NT$0.50, or 4.4 percent, to NT$11.90. Taiwan's third-largest maker of flat-panel displays plans to raise prices by about 3 percent next month because demand is exceeding the company's supply. Chunghwa also plans to spend as much as NT$960 million to buy back 50 million shares, or 1 percent of its outstanding shares, for two months starting yesterday.

Ever Fortune Industrial Co (長生) slipped NT$0.02, or 6.5 percent, to NT$0.29. The property developer may be forced to delist as creditors refuse to extend loans, forcing the company to fail to honor checks, the Commercial Times said.

First International Computer Inc (大眾電腦) gained NT$0.15, or 2.2 percent, to NT$7.05. The printed-circuit-board unit of the Taiwan computer maker received an order to supply 70 percent of the boards for Nintendo Co's Game Cube console this year, a local newspaper reported.