Tue, Nov 01, 2005 - Page 11 News List

Wall Street's lead provides rebound, boost for TAIEX


Share prices closed 2.33 percent higher yesterday, rebounding after recent sustained losses following Wall Street's lead on Friday on better-than-expected third quarter US growth data.

Leading the gainers were semiconductor and flat-panel bellwethers, such as Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), United Microelectronics Corp (UMC, 聯電), AU Optronics Corp (友達光電) and Chi Mei Optoelectronics Corp (奇美電子).

The weighted index closed up 131.33 points at 5,764.30, off a low of 5,681.20 and a high of 5,774.61, on turnover of NT$73.18 billion (US$2.18 billion).

The electronics sector was up 3.25 percent and financials added 1.70 percent while construction and cement stocks did well.

"Wall Street saved the day," said Oliver Fang, a Yuanta Core Pacific Securities (元大京華證券) assistant vice president. "A further decline would have been likely ... if not for the dramatic upturn of US equities on Friday," he said, referring to Wall Street's gain of some 1.69 percent.

Foreign investors, who had been on the sell-side on Friday, appeared to have switched tack, providing support for some of the technology stocks, he said, adding that a continued technical rebound should be possible in the short-term given investors largely expect further US rate hikes.

"Even the prospective rate hike by 25 basis points in November and another such increase in December by the Fed is unlikely to derail [the markets] as they have been largely priced in already," Fang said.

TSMC was up NT$1.60 at NT$52.00 while UMC added NT$1.05 at NT$17.80, with the stock having been under pressure for some time.

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