Taiwan's key stock index had its biggest gain in seven months after a second opposition politician headed for China, the nation's biggest trading partner, in an attempt to mend ties.
Hon Hai Precision Industry Co (
The bottom for relations between China and Taiwan "may have passed and the ground has been laid for improved communication," Dickson Ho (何資文), head of research at Morgan Stanley in Taipei, wrote in a note dated yesterday. "We expect the market to react favorably to any positive developments on the political front."
The TAIEX jumped 123.82, or 2.1 percent, to 5,927.50, its biggest gain since Oct. 4.
More than five stocks advanced for every one that declined.
Futures due this month added 1.7 percent to 5,902.
Hon Hai Precision, the nation's largest electronics company by sales and which counts China as a manufacturing base, rose 2.5 percent to NT$144.50. Quanta Computer Inc (
EVA Airways, the nation's second-biggest airline, added 1.3 percent to NT$15.20. China Airlines (
"Tensions will soon be a thing of the past," said Phil Chen, who helps manage the equivalent of US$1.9 billion at Grand Cathay Securities Investment Trust Co (
Morgan Stanley Capital International Inc announced last June it will raise the weighting of Taiwan's stocks in global indexes to 100 percent from 75 percent on May 31. Investors may buy about US$4 billion of the nation's equities to track the benchmarks, analysts and investors said at the time.
"The timing is perfect for Taiwan stocks. We are seeing investors in Asian markets shifting investment to the island ahead of the MSCI index rebalance this month," said Jerry Chen, a fund manager at Taipei-based First Global Investment Trust Co (元大投信).
Overseas institutional investors bought a net NT$10.64 billion worth of shares on Thursday.
Merida Industry Co (美利達) has seen signs of recovery in the US and European markets this year, as customers are gradually depleting their inventories, the bicycle maker told shareholders yesterday. Given robust growth in new orders at its Taiwanese factory, coupled with its subsidiaries’ improving performance, Merida said it remains confident about the bicycle market’s prospects and expects steady growth in its core business this year. CAUTION ON CHINA However, the company must handle the Chinese market with great caution, as sales of road bikes there have declined significantly, affecting its revenue and profitability, Merida said in a statement, adding that it would
Greek tourism student Katerina quit within a month of starting work at a five-star hotel in Halkidiki, one of the country’s top destinations, because she said conditions were so dire. Beyond the bad pay, the 22-year-old said that her working and living conditions were “miserable and unacceptable.” Millions holiday in Greece every year, but its vital tourism industry is finding it harder and harder to recruit Greeks to look after them. “I was asked to work in any department of the hotel where there was a need, from service to cleaning,” said Katerina, a tourism and marketing student, who would
i Gasoline and diesel prices at fuel stations are this week to rise NT$0.1 per liter, as tensions in the Middle East pushed crude oil prices higher last week, CPC Corp, Taiwan (台灣中油) and Formosa Petrochemical Corp (台塑石化) said yesterday. International crude oil prices last week rose for the third consecutive week due to an escalating conflict between Israel and Iran, as the market is concerned that the situation in the Middle East might affect crude oil supply, CPC and Formosa said in separate statements. Front-month Brent crude oil futures — the international oil benchmark — rose 3.75 percent to settle at US$77.01
RISING: Strong exports, and life insurance companies’ efforts to manage currency risks indicates the NT dollar would eventually pass the 29 level, an expert said The New Taiwan dollar yesterday rallied to its strongest in three years amid inflows to the nation’s stock market and broad-based weakness in the US dollar. Exporter sales of the US currency and a repatriation of funds from local asset managers also played a role, said two traders, who asked not to be identified as they were not authorized to speak publicly. State-owned banks were seen buying the greenback yesterday, but only at a moderate scale, the traders said. The local currency gained 0.77 percent, outperforming almost all of its Asian peers, to close at NT$29.165 per US dollar in Taipei trading yesterday. The
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