TSMC, Hon Hai lead stock rally

Stocks rose for the first day in eight yesterday, led by exporters such as Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), after US Federal Reserve Chair-man Alan Greenspan said a slowdown in consumer spending in the world's largest economy may be "short-lived."

The TAIEX rose 83.45, or 1.6 percent, to 5,409.13. The benchmark had slid 7.8 percent in the previous seven days, the longest losing streak since December 2002. Futures for July delivery added 2.2 percent to close at 5,418. About four stocks gained for every one that declined.

TSMC rose 4.6 percent, to close at NT$43.40.

AU Optronics Corp (友達光電), the world's third-largest maker of flat-panel displays for computers and televisions, advanced 0.7 percent to close at NT$41.40. But AU Optronics earlier fell as much as 2.7 percent after its stock-price prediction for the next six months was slashed to NT$38 from NT$87 by Timothy Chen (陳建光), an analyst at CLSA Asia-Pacific Markets.

Hon Hai Precision Industry Co (鴻海精密) and Novatek Microelectronics Corp (聯詠科技) were among 20 Asian stocks named by Merrill Lynch as poised to rise next year.

Hon Hai Precision rose 5.9 percent to NT$116.50. Novatek surged 6.8 percent to NT$86.

Chunghwa Telecom Co (中華電信) fell 1.8 percent to NT$53.50 after rival Taiwan Cellular Corp (台灣大哥大) sold 7.67 million shares of Chunghwa Telecom for NT$410.9 million (US$12.1 million). Taiwan Cellular fell 0.9 percent to NT$33.30.