Stocks close higher, following on from Wall Street gains

Share prices closed 0.83 percent higher yesterday on the latest gains on Wall Street and an easing of political concerns after an opposition rally ended without incident on Sunday, dealers said.

The moderate turnover, however, indicated lingering caution over corporate earnings during the the seasonally weaker first half of the year, they said.

The weighted index rose 53.95 points at 6,544,63, after trading between 6,502.51 and 6,551.13, on turnover of NT$83.40 billion (US$2.67 billion).

The tourism sector was up 3.13 percent on revived hopes for more Chinese sightseers coming to the nation, while the key electronics stocks added 1.27 percent.

Supporters of the Chinese Nationalist Party (KMT) and its allies took to the streets on Sunday to protest President Chen Shui-bian's (陳水扁) scrapping of the National Unification Council.

The rally passed off peacefully but the Democratic Progressive Party (DPP) is scheduled to mount a counter demonstration this weekend, keeping political tensions on the boil.

Dealers said the gains yesterday were not enough to suggest the market was ready to move into a higher trading range and stocks could fall back again, especially in view of the modest turnover.

SinoPac Securities (建華證券) assistant vice president Alvin Teng (鄧可欣) said that the volumes were solid evidence that the market will have difficulty in breaching 6,650 points any time soon.

"The aftermath of Chen's controversial move cannot be fully assessed until US President George W. Bush meets with his Chinese counterpart Hu Jintao (胡錦濤) in April," Teng said.