Thu, May 04, 2006 - Page 11 News List

Foreign funds boost NT dollar, lift TAIEX to a six-year high


The local currency continued to strengthen against the US dollar yesterday amid increased inflows of foreign funds to buy domestic stocks, traders said.

On the Taipei foreign exchange market, the New Taiwan dollar closed NT$0.159 higher at NT$31.627 to one US dollar, trading at its highest level in more than nine months.

Turnover was US$1.24 billion, up from US$1.207 billion the previous day.

Traders said that foreign in-vestors' net purchases of domestic stocks, totaling NT$11.732 billion (US$371 million) yesterday, helped push the local currency as high as NT$31.59 in yesterday's session.

The NT dollar may test the NT$31.5 level if the Japanese yen rises through ?113 per one US dollar, traders said.

The local market was also waiting yesterday for US Federal Reserve chairman Ben Bernanke's speech at an economic summit in Washington later in the day.

Strong foreign fund inflows also pushed shares up yesterday to a new six-year high, with the benchmark TAIEX rising 42.77 points, or 0.6 percent, to 7,242.37.

High Tech Computer Corp (宏達電), which makes smartphones that use Microsoft Corp's operating system, led the local bourse, hitting the daily limit of 7 percent for the second consecutive day. Its share price closed at NT$1,165 (US$36.84).

While a firmer NT dollar may hurt stocks that focus on exports, asset plays like Cathay Real Estate Development (國泰建設) remained active. Cathay shares rose 7 percent to NT$22.2.

Turnover on the Taiwan Stock Exchange was NT$154.61 billion, compared with NT$142.48 billion the previous day.

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