Sat, Aug 02, 2003 - Page 11 News List

US economic reports help boost TAIEX

BLOOMBERG

Stocks gained for a second day yesterday, led by exporters such as Taiwan Semiconductor Manufac-turing Co (TSMC, 台積電) and Quanta Computer Inc (廣達電腦), after US economic reports showed the world's largest economy is picking up.

The TAIEX added 72.17, or 1.4 percent, to 5,390.51. About two stocks gained for every one that fell. The index shed 0.1 percent this week, declining only for a second week in 13.

August futures on the benchmark rose 1.1 percent to 5,390.

A US Labor Department report said initial jobless claims were 388,000 last week, less than expected by economists polled by Bloomberg. An index of Chicago-area manufacturing also rose to 55.9 last month from 52.5 in June, beating some economists expectations. A reading of more than 50 suggests expansion.

The US is Taiwan's second-largest export market after China.

"The latest US economic indicators have eased investors' concerns about whether the recent stock rally is sustainable," said Yu Reming, who oversees the equivalent of US$4.2 billion in stocks at Prudential Securities Investment Trust Co.

"An improved US economy will provide the engine to pull exporters worldwide out of the murkiness," Yu said.

TSMC, which gets three-quarters of its sales from the US, rose NT$1, or 1.7 percent, to NT$60. Foreign investors bought a net 40 million shares of the company on Thursday, more than any other stock, according to the Taiwan Stock Exchange.

Quanta Computer, the world's largest notebook computer maker that counts Dell Inc as its biggest customer, rose NT$4, or 4.9 percent, to NT$85.

About 4.1 billion shares changed hands, 6 percent below the average trading in the past three months. The value of trading was NT$103.4 billion ($3 billion), 11 percent above the three-month daily average.

Chi Mei Optoelectronics Corp(奇美光電) rose NT$1.40, or 4.1 percent, to NT$35.40. Chi Mei sold US$200 million of five-year bonds convertible into its shares, according to a statement sent to investors.

Taiwan Cellular Corp. (台灣大哥大) rose NT$1.10, or 4.2 percent, to NT$27.10 after it said it will unwind cross-shareholdings, sell a stake in a rival and may merge with a unit as it reorganizes to improve profits and attract investors.

Acting chairman Daniel Tsai (蔡明忠) announced the measures, which include the sale of a one-third stake in Taiwan Cellular owned by affiliate Taiwan Fixed Network Ltd (台灣固網), at a press conference on Thursday.

VIA Technologies Inc (威盛), the world's second-largest maker of chipsets for personal computers, rose NT$3.50, or 6.3 percent, to NT$59.50. VIA will start selling processors to Motorola Inc for use in digital television equipment, a Chinese-language newspaper reported, citing unidentified officials.

VIA, which will ship more than 10,000 processors to Motorola, expects sales of the chips this year to increase by about 50 percent to 270 million units, the report said.

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