TAIEX recovers on Wall Street's sharp overnight upturn

Share prices closed 2.32 percent higher yesterday, with the market building on early gains driven by Wall Street's sharp rally overnight, dealers said.

They said investors put aside concerns over the political crisis surrounding President Chen Shui-bian (陳水扁), whose aides and family members face allegations of corruption, and opted instead to follow the US lead which saw the region as a whole rebound strongly.

The TAIEX rose 149.38 points at 6,575.77, on turnover of NT$110.21 billion (US$3.39 billion).

"The sharp rally in US stocks yesterday boosted investor confidence," said Andrew Teng (鄧安瀾), sales manager at Taiwan International Securities Corp (金鼎證券). "Also, Taiwan shares have fallen a bit too much lately," he said.

The day's gains were pared by some late profit-taking due to lingering uncertainty over the extent of the impact of the impending US interest rate hikes and the political bickering between Chen's government and parliament, which is deliberating on an opposition proposal to seek a referendum on ousting him.

Dealers said the market, however, benefited also from the rebound in other regional markets following Wall Street's sustained rise for the second consecutive session.

Chang Hwa Commercial Bank (彰化銀行) rose 4.6 percent to NT$22.9, while Taishin Financial Holding Co (台新金控) gained 6.9 percent at NT$20.95. The Financial Supervisory Commission on Thursday approved Taishin's plan to raise its 22 percent stake in Chang Hwa by 7.5 percent.

There were 658 gainers, 163 decliners, and 85 stocks closed unchanged.