Stocks rose to a three month high yesterday. Taiwan Semiconduc-tor Manufacturing Co (TSMC, 台積電) gained after the Philadel-phia Semiconductor Index rose to an almost seven-week high, raising optimism about the technology industry.
The TAIEX added 84.72, or 1.4 percent, to 5,949.26, its highest since June 9. Index futures for September rose 1.8 percent to 5,945. About three stocks advanced for every two that fell. Shares worth NT$94.4 billion (US$2.8 billion) traded, 45 percent above the three-month daily average.
Semiconductor stocks rose in the US after Adam Parker, a Sanford C. Bernstein & Co analyst, told investors to buy shares of firms that have reduced their sales or earnings forecasts. Rising inventories and unused production capacity will reduce growth less than investors anticipate, Parker wrote in a note.
"Although technology companies have excess inventory and face falling product prices, many of them are still profitable and are undervalued," said Phil Chen, a fund manager at Grand Cathay Securities Investment Trust Co (
TSMC gained 1.8 percent to NT$46. United Microelectronics Corp (
Stocks of these LCD manu-facturers gained after Mitsubishi Electric Corp said it will phase out production of flat-panel displays for TVs and computers by fiscal 2006, because increasing competition is driving down prices.
AU Optronics Corp (友達光電), the nation's largest maker of flat-panel displays, rose 2 percent to NT$45.30. Chi Mei Optoelectronics Corp (
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