Share prices closed 0.63 percent higher yesterday as a late rally in bellwether technology stocks offset profit-taking in early trade, dealers said.
They said consumer electronics outperformed the market due to positive prospects for the industry and expectations of foreign capital inflows.
The weighted index rose 41.83 points to 6,724.18, off a low of 6,664.80 and a high of 6,733.52, on turnover of NT$88.64 billion (US$2.78 billion).
Decliners outperformed gainers 561 to 526, with 157 stocks unchanged.
Sixteen stocks closed limit-up, while 10 were limit-down.
The electronics sector was up 1.40 percent and the textile sector up 0.67 percent.
Fubon Securities Co (富邦證券) senior vice president Frank Lin said trading focused on the cellular phone handset and thin-film-transistor liquid-crystal-display sectors.
"Riding on a previous correction, investors were willing to build positions in consumer electronics with rosy prospects," Lin said.
He said while there were concerns over company results to be released by major US firms, the local bourse received support from liquidity flowing into the market.
Taiwan Semiconductor Manu-facturing Co (台積電) closed down NT$0.60 at NT$63.90, while United Microelectronics Corp (聯電) rose NT$0.30 to NT$18.55.
BenQ Corp (明基) gained NT$1.65 to NT$35.05 and Hon Hai Precision Industry Co (鴻海精密) rose NT$14.00 to NT$225.00.
AU Optronics Corp (友達光電) added NT$1.90 to NT$49.40 and Chi Mei Optoelectronics Corp (奇美電子) rose NT$2.15 to NT$47.50.