Wed, Dec 29, 2004 - Page 11 News List

TAIEX closes higher on speculation

BLOOMBERG AND AFP , TAIPEI

The New Taiwan strengthened against the US dollar on speculation global investors will increase purchases of the nation's stocks.

Overseas fund managers bought a net NT$3.7 billion (US$116 million) of Taiwan's stocks, the biggest amount since Dec. 20, Taiwan Stock Exchange figures show. They were net buyers for an 11th day, totaling NT$30.6 billion.

The NT dollar rose NT$0.15, or 0.5 percent, to close at NT$32.03 against the US dollar, the strongest close and biggest gain since Dec. 2, in Taipei. Turnover was US$684 million, up from the previous day's US$447 million.

The TAIEX closed 0.24 percent higher yesterday in a technical bounce amid continued concerns over China's plan to draft an anti-secession law aimed at Taiwan, dealers said.

Although bargain-hunting on expectations of a liquidity-driven rally in January curbed the downside after Wall Street's losses overnight, the prevailing holiday mood kept most investors on the sidelines.

The TAIEX closed up 14.63 points at 6,000.57, on turnover of NT$37.05 billion (US$1.15 billion). The benchmark index has risen 1.9 percent this year, helping the local currencies gain 6.1 percent.

Selected local thin-film-transistor liquid crystal display (TFT-LCD) panel makers led the broad electronics higher thanks to industry leader Samsung Electronics Corp's plans to build a second seventh-generation panel plant.

"This move by the Korean industry leader was interpreted as [showing the] potential for industry demand growth following recent product price falls," said Alex Huang, an assistant vice president with Barits International Securities (倍利證券).

AU Optronics Corp (友達光電) put on NT$0.10 at NT$45.40. Small rival Chi Mei Optoelectronics Corp (奇美電子) rose NT$0.20 to NT$41.70 with the Samsung lead outweighing Chi Mei's decision to cut its 2004 profit forecast to NT$18.37 billion from the NT$30.15 billion projected in April.

Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) was up NT$0.10 at NT$50.00.

Investors should buy Asian computer-related stocks such as TSMC, said Spencer White, head of Merrill Lynch & Co's Hong Kong-based Asia-Pacific equity strategy.

White recommended investors hold more shares of Taiwanese companies than represented in the Morgan Stanley Capital International's Asia-Pacific ex-Japan Index.

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