Positive Morgan Stanley statement buoys shares

Stocks rose, led by Taiwan Semiconductor Manufacturing Co (台積電), after Morgan Stanley Capital International Inc said it was considering upgrading Taiwan's equities, a move that would prompt investors tracking MSCI indexes to park more funds in Taiwan.

MSCI is studying emerging markets, including South Korea and Taiwan, for upgrades, although no decision's been made, said Toshiaki Matsumae, head of MSCI in Tokyo.

Any such reclassification would likely increase foreign fund flows to the countries as developed markets are seen as safer investments than emerging markets.

The TAIEX added 85.21, or 1.4 percent, to 6,353.35. Four stocks gained for every one that declined. Taiex Futures for February rose 1.3 percent to 6,365. The TAIEX dropped 0.4 percent this week, its first weekly decline in six.

Stocks with the biggest benchmark market values advanced.

TSMC added 0.8 percent to NT$63. Hon Hai Precision, the nation's largest company by sales, jumped 2 percent to NT$150.

AU Optronics Corp (友達光電), the country's largest maker of flat-panel displays for personal computers, gained 1.1 percent to NT$48. Sales last month more than doubled from a year earlier to NT$12.1 billion (US$363.5 million).

Chi Mei Optoelectronics Corp (奇美電子), the nation's second-largest maker of flat-panel displays, rose 3.3 percent to NT$44. The company expects worldwide demand for flat-panel television sets to as much as triple that of last year's to 12 million units, the DigiTimes reported.

BenQ Corp (明基電通), the nation's largest mobile-phone maker, gained 4.4 percent to NT$42.50. Last month's sales rose 38 percent to NT$11.2 billion, from NT$8.2 billion a year earlier. Sales declined from NT$12.7 billion in the previous month.