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Shares up, bolstered by New York, China

Shares closed 1.34 percent higher yesterday on increased turnover, with sentiment bolstered by Wall Street's gains on Friday, amid news of corporate takeovers, followed by the rise on Chinese markets, dealers said.

Some investors stayed on the sidelines during early trade due to uneasiness over China's decision to hike interest rates, increase the bank reserve ratio and widen the yuan's daily trading band.

However, Chinese stocks ended the morning session in positive territory, convincing local investors to chase prices markedly higher during late trading.

Buying interest was also backed by the removal of worries over the effects of President Chen Shui-bian's (陳水扁) inauguration anniversary speech as his remarks were not perceived to have dampened cross-strait relations.

The weighted index closed up 107.45 points at 8,141.59, on turnover of NT$104.46 billion (US$3.13 billion).

Fubon Securities (富邦證券) senior vice president Frank Lin said factors at home and abroad proved to be favorable to the equity market.

"Wall Street scored gains on Friday, Chen did not deliver any surprising remarks and the mainland market headed north in the morning," Lin said.

He said petrochemical stocks attracted interest due to product price hikes, while technology shares danced to the tune of their US counterparts.
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