Stocks firming up following investor bargain-hunting

Share prices closed 0.22 percent firmer in modest trade yesterday as late bargain-hunting took the market off early lows following Wall Street's overnight downturn, dealers said.

They said continuing political concerns over President Chen Shui-bian's (陳水扁) future kept the market cautious as regional markets fell on a fresh bout of nerves over the outlook for US interest rates.

However, local investors found some bargains after Monday's 3.51 percent drop.

The TAIEX added 15.00 points or 0.23 percent at 6,730.27, on turnover of NT$94.31 billion (US$2.94 billion).

Decliners led risers 466 to 290, with 100 stocks unchanged.

Traders said they suspected government funds of intervening in the market yesterday, while the government denied allegations from opposition politicians that sales by government-linked funds were behind the decline.

The market is unlikely to enjoy a sustainable recovery to above 6,800 points anytime soon, also because of the uncertainty regarding the pace of US economic growth and interest rate prospects, they added.

The technology subindex edged up 0.1 percent yesterday, and the financial subindex rose 0.8 percent.

Taiwan Semiconductor Manu-facturing Co (台積電), the world's largest contract chipmaker by revenue, rose 0.7 percent to NT$60.8.

Cathay Financial Holding Corp (國泰金控), the nation's largest financial group by assets, gained 1.8 percent to NT$73.1 and China Development Financial Holding (中華開發金控) rose 2.9 percent to NT$12.3.