Shares up to end the year
Taiwanese shares closed up 0.93 percent yesterday as institutional investors bought to boost their books at the end of the year, dealers said.
The weighted index rose 75.83 points to 8,188.11 on turnover of NT$164.51 billion (US$5.11 billion).
The index had opened 0.53 percent higher on follow-through buying from Wednesday as the market was awash in funds, and interest accelerated with institutional investors picking up financial firms and select high-tech stocks, dealers said.
For the whole of last year, the local bourse rose 78.3 percent from the end of 2008 amid closer cross-strait business ties and a global economic recovery.
“It has been a good year,” TLG Asset Management (台壽保投信) analyst Arch Shih (施博元) said. “Investors have been upbeat about the economic fundamentals at home and abroad.
“While the market has scored significant gains for the year, many of them remained willing to buy now, shrugging off possible major corrections,” he added.
Short covering lifted the financial sector after its recent consolidation, Shih said.
A year of TAITRA plans
The Taiwan External Trade Development Council (TAITRA) will carry out a series of promotions this year targeting emerging markets, an official said on Wednesday.
In addition to organizing business tours to emerging markets, TAITRA will also invite major buyers from those markets to Taiwan, said TAITRA secretary-general Chao Yung-chuan (趙永全).
After the China-ASEAN free trade area is inaugurated today, 90 percent of goods traded within the region will be given duty-free treatment, which will severely impact on Taiwan’s small and medium-sized businesses and traditional industries, he said.
Direct exports from Taiwan to ASEAN countries presently account for 15 percent to 16 percent of the country’s total exports, higher than 12 percent to Europe and the US, he noted.
Chao said 10 purchasing missions from China are expected this year, with miscellaneous goods and food the main target products.
NT dollar rises
The New Taiwan dollar rose, rounding out its best annual performance since 2004, as overseas investors increased holdings of the nation’s stocks amid signs that an economic recovery is gathering pace.
For 2009, funds based overseas bought US$15.6 billion more in Taiwanese shares than they sold, the biggest net purchase figure in three years, while the TAIEX index of equities rallied 78 percent.
The economy may expand 4.39 percent next year, compared with a 2.53 percent contraction this year, the Cabinet’s statistics bureau projected last month.
“Foreign companies sent in relatively large amounts of funds as stocks surged,” said Henry Lin, a currency trader at Taiwan Shin Kong Commercial Bank (新光銀行) in Taipei.
“A lot of people remitted funds to Asia betting on next year’s foreign-exchange and capital gains on the region’s upbeat economic outlook,” he said.
The NT dollar climbed 0.7 percent to NT$32.030 against its US counterpart on turnover of US$1.198 billion as of 4pm, the biggest gain since June, according to Taipei Forex Inc. It reached NT$31.948, the strongest level since September last year.
The local currency advanced 2.5 percent last year, and may strengthen another 5 percent by the end of this year to NT$30.5, the median estimate of economists surveyed by Bloomberg shows. The currency weakened 1.8 percent in the last decade.
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