Oil price ease gives TAIEX its biggest week since August

Stocks rose, giving the TAIEX its biggest weekly jump since August. Hon Hai Precision Industry Co (鴻海精密) led gains among exporters after a drop in crude oil prices eased concern that higher fuel costs would slow economic growth.

Stocks also gained after the High Court upheld President Chen Shui-bian's (陳水扁) election victory eight months after the poll. Opposition parties had petitioned to overturn the result on allegations of vote fraud.

"The drop in oil prices eases uncertainties for corporate profitability next year," said Kevin Yang, who manages the equivalent of US$90 million as vice president of International Investment Trust Co (國際投信) in Taipei.

"Rejecting the petition means political stability that investors prefer," he said.

The TAIEX added 70.58, or 1.2 percent, to close at 5,931.3. It gained 4 percent in the past five sessions, the biggest weekly advance since Aug. 20. About four shares rose for each one that fell. Futures due in November gained 1.4 percent to 5,920.

Crude oil fell 0.4 percent to US$48.61 a barrel, the lowest since Sept. 23, in Asian trading hours on the New York Mercantile Exchange. The December contract slid 4.1 percent on Thursday.

Hon Hai, the nation's biggest electronics company by sales, gained NT$3, or 2.4 percent, to NT$130.50. Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world's largest supplier of made-to-order chips, rose NT$0.20, or 0.4 percent, to NT$47.70. Nvidia Corp, the world's biggest maker of chips for computer graphics, said third-quarter profit jumped more than fourfold. TSMC is Nvidia's biggest supplier.