Asian stocks closed mostly higher on Friday after US Federal Reserve Chairman Alan Greenspan reassured Congress that the US economy was in reasonable shape.
Overall, the Fed chairman said, "the US economy seems to be on a reasonably firm footing, and underlying inflation remains contained."
His comments spurred Wall Street to a higher finish and markets in the Asia Pacific followed suit with Taipei, Tokyo, Singapore and South Korea leading the push into positive territory.
A brighter second-quarter forecast by chipmakers Intel in the US and Taiwan Semiconductor Manufacturing Co added some extra gloss to those markets.
The Philippines stood out as the best performer, rising 2.05 percent, but dealers said this was largely due to a technical bounce after three days of sharp falls amid persistent rumors of a coup to oust President Gloria Arroyo.
However, China bucked the trend and closed lower after profit takers lived up to expectations and moved in to cash up on recent, very sharp, gains.
Share prices closed 0.76 percent higher in Taiwan, supported by a firmer Wall Street.
Dealers said there was some profit-taking in early trade but bellwether electronics and other stocks sustained their gains on expectations of continued purchases by foreign investors after Taiwan Semiconductor Manufacturing Co (TSMC,
"Foreign investors remain avid buyers in the local bourse," said Oliver Fang of Yuanta Core Pacific Securities (
"Few now expect an immediate pullback as even domestic institutions and small investors find it increasingly hard to resist to jump on to the bandwagon," he said.
But it remains to be seen if some of the foreign investors who have bought aggressively since last month are doing so for arbitrage, he said.
"We can get some answers when June futures contracts on the weighted index are settled next week and toward the end of the month," Fang said.
The TAIEX closed up 46.43 points at 6,192.35 on turnover of NT$88.62 billion (US$2.83 billion).
TSMC was up NT$0.10 at NT$58.10 after raising its guidance for the second quarter after market close Thursday. The company raised its estimates for shipments, utilization rate and gross margin for the three months to June.
Tokyo share prices closed 1.28 percent higher, supported by a firmer Wall Street.
Dealers said upgrades by US chip giant Intel and TSMC also bolstered sentiment.
"Investors took heart from the remarks overnight by Greenspan ... and from Intel's upward revision of its June quarter earning forecast," said Koichi Ogawa, chief fund manager at Daiwa SB Investments.
The NIKKEI-225 index gained 143.35 points to 11,304.23 on volume of 2.03 billion shares, up from 1.20 billion on Thursday due to Friday's special quotation for settling monthly options and futures contracts.
Share prices closed 0.33 percent higher in Seoul to break 990 points for the first time in two months, led by Samsung Electronics after Intel and TSMC of Taiwan upgraded their second quarter guidance.
Dealers said investors were relieved by US Federal Reserve
The KOSPI index closed up 3.21 points at 990.79.
Samsung Electronics' 1.9 trillion won share buy-back plan provided support for the stock but it will be interesting to see whether foreign investors, who have been on the sell-side on the stock, take advantage of the offer.