Stocks gained, sending the TAIEX higher for a third day to its highest in 18 months.
Nan Ya Plastic Corp (南亞塑膠) and Formosa Plastics Corp (台塑) advanced on optimism demand for their products will increase, helping lift profits, some analysts said. J.P. Morgan Taiwan said in a report this week it expects to see an improvement in Nan Ya Plastic's fourth-quarter operating profit.
``Their businesses are picking up from the third quarter and demand is coming from China,'' said Josephine Ho, an analyst at Yuanta Core Pacific Securities Co (元大京華證券). ``Given the limited capacity and stable demand growth, we're likely to see a shortage in the next few years. That's why share prices are pushed up.''
The TAIEX rallied 33.33, or 0.6 percent, to 6142.32, after earlier falling as much as 0.1 percent. The last time the benchmark closed higher was on April 29, 2002. The futures index added 0.5 percent to 6175.
Nan Ya Plastics climbed NT$1.60, or 3.4 percent, to NT$48.90. Formosa Plastics gained NT$0.50, or 1 percent, to NT$53.00.
AU Optronics Corp (友達光電), Taiwan's biggest maker of flat-panel displays, added NT$0.20, or 0.4 percent, to NT$45.20.
Makers of liquid-crystal display screens for computers including AU Optronics will benefit from Intel Corp's 35 percent price cut on processors for personal computers, the Wall Street Journal reported yesterday, citing Crystal Lee, analyst at ABN Amro Holding NV.
China Steel Corp (中鋼), Taiwan's biggest steelmaker, shed NT$0.20, or 0.7 percent, to NT$28.20 after the stock rose to a record yesterday. The stock had risen after the company said on Monday that sales rose 26 percent in October. China Steel last week reported an 88 percent jump in its third-quarter profit and raised its full-year profit forecast.
Silicon Integrated System Corp (矽統科技), the world's third-largest maker of chipsets for personal computers, rose NT$0.20, or 0.7 percent, to NT$27.50. The company said it agreed to develop semiconductors with Microsoft Corp for the U.S. company's Xbox video-game console.
President Securities Corp (統一證券), a brokerage controlled by Taiwan's largest food company Uni-President Group (統一集團), added NT$0.10, or 0.7 percent, to NT$14.95. The brokerage said it will focus on expansion instead of looking for a bigger rival to take it over. Uni-President Group Chief Executive Kao Ching-yuan (高清愿) previously said the brokerage was for sale.
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