Share prices closed 0.66 percent higher yesterday in a technical rebound triggered by a recovery in the local currency, but trade was hampered by some profit-taking, dealers said.
The TAIEX closed up 46.93 points at 7,116.83.
Turnover was NT$110.15 billion (US$3.48 billion).
"The appreciation of the local currency re-ignited hopes for foreign capital inflows and injected [some momentum] into the stock market," said Tom Tang (
Expectations for an influx of fresh foreign capital supported large-cap stocks in particular.
In addition, "some stocks backed with hefty real estate [assets] attracted interest again thanks to the strength of the Taiwan dollar," Tang said.
Before yesterday's rise, the benchmark index fell by nearly 4 percent to the closing level of 7,069.9 on Tuesday, in a three-session decline as stock markets fell globally.
Boosting the main board's rise, Taiwan Semiconductor Manufacturing Co (台積電) rose 2.1 percent to NT$63.7.
Rival United Microelectronics Corp (聯電) gained 3.7 percent to NT$21.1.
However, liquid-crystal-display (LCD) panel makers fell on growing concerns about lower panel prices in the second half of the year.
AU Optronics Corp (
The nation's second-largest LCD panel maker by revenue, Chi Mei Optoelectronics Corp (奇美電子), lost 1.2 percent at NT$42.7.