The TAIEX surged 3.25 percent, or 243.2 points, to close at 7,736.32 yesterday following an overnight rally on Wall Street, with large-cap stocks leading the rebound.
Trading remained heavy for the fourth consecutive trading day, with turnover totaling NT$178.58 billion (US$6.12 billion) yesterday, Taiwan Stock Exchange data showed.
Foreign investors’ net sales amounted to NT$30.17 billion, increasing for the seventh straight trading day, while purchases by government-run funds and state-owned banks offset heavy selling pressure created by foreign investors, a dealer told the Taipei Times.
“The buying momentum was mostly focused on large-cap technology stocks, while the financial sector also played an important role in leading the benchmark index’s rise,” said the dealer, who declined to be named.
HTC Corp (宏達電), the world’s No. 5 smartphone brand, closed up 4.33 percent at NT$820, while Fubon Financial Holding Co (富邦金控), the nation’s most profitable financial service provider, surged 5.36 percent to close at NT$45.25.
These large-cap stocks led the electronics sector to increase 3.35 percent, while the financial sector surged 4.68 percent, data showed.
Before yesterday’s rebound, the TAIEX had lost more than 13 percent this month amid concerns over an economic slowdown in the US and debt problems in the eurozone.
Council for Economic Planning and Development Minister Christina Liu (劉憶如) said yesterday that the US Federal Reserve’s announcement that it would maintain low interest rates until 2013 indicates that market liquidity would remain ample during this period.
“However, there is still the chance that the Fed will launch another wave of quantitative easing measures, or QE3, to boost the US economy if the low interest rate policy proves less effective than expected,” Liu said, adding that QE3 would bring uncertainty to Wall Street as well as global markets.
Daniel Chang (張博淇), an analyst at Macquarie Capital Securities Ltd in Taiwan, expects a volatile market and predicts shares would fall in the next one to two months amid the continuing fears of a double-dip recession in the US and its impact on other Western countries.
Macquarie’s research team has lowered its year-end forecast for the TAIEX to 8,500 points, from the 9,000 points it previously estimated, after factoring in recent earnings adjustments by Taiwanese technology firms.
“We think a short-term bounce is likely, but don’t expect a full recovery any time soon,” Chang said in the report on Tuesday.
Earlier this week, Citigroup Global Markets Inc lowered its year-end forecast for the TAIEX to 8,770 points from the 10,000 points it had previously set, believing there may only be a muted pre-election rally given the close race between the candidates.
Deutsche Bank AG maintained its year-end forecast for the TAIEX at 9,300 points, with its Taiwan market strategist Joelian Tseng (曾慧瓊) suggesting investors consider bargain-hunting if the index approached 7,000 points.
Credit Suisse also kept its year-end forecast unchanged at 9,500 points, while Goldman Sachs maintained that the TAIEX could reach 10,700 points in 12 months.
‘ACCORDING TO PLAN’: A company official said that it has set up production sites worldwide to provide services and that its Wisconsin project was going smoothly Hon Hai Precision Industry Co’s (鴻海精密) smart manufacturing center in Wisconsin would begin trial manufacturing in the middle of this year, the company said yesterday, adding that it plans to build a research institute to develop key technologies to support growth over the next five years. Hon Hai, known internationally as Foxconn Technology Group (富士康科技集團), said in an annual report submitted to the Taiwan Stock Exchange that its planned Foxconn Institute for Research in Science and Technology would conduct research into artificial intelligence, next-generation communications, quantum computing, cybersecurity and nano semiconductors in Taiwan. Hon Hai is to make products at the center
TV and online retailer Momo.com Inc (富邦媒體) yesterday said it has set up a new logistics subsidiary, Fu Sheng Logistics Co (富昇物流), to oversee the company’s extensive shipping operations. Leveraging Momo’s 23 satellite warehouses and distribution centers nationwide, Fu Sheng will be in charge of executing the retailer’s same-day shipment plan for deliveries in Taipei, New Taipei City, Taoyuan, Taichung, Tainan and Kaohsiung, Momo said in a press release. Seeking to further shorten its supply chain, the company is to set up another seven satellite warehouses and distribution centers by the end of the year. “Fu Sheng has a fleet of 200 couriers
E Ink Holdings Inc (元太科技), the world’s sole supplier of e-paper displays for e-readers and shelf labels, posted its best quarterly net profit for the first quarter in nine years amid increased demand during a traditionally slow season. Net profit soared 80 percent to NT$787 million (US$26.23 million) in the quarter ended March 31, compared with NT$438 million a year earlier. That translated into earnings per share of NT$0.69, up from NT$0.39. E Ink posted lower royalty income of NT$371.23 million last quarter from NT$448.74 million a year earlier, a company financial statement showed. E Ink said that it expects royalty income to
STAYING AHEAD: Fitch said that TSMC remains technologically ahead of others, but Samsung is building a new chip fab, while China is investing in its domestic industry As escalating US-China tensions and COVID-19-related production disruptions force US technology supply chains to transform, Taiwan Semiconductor Manufacturing Co’s (TSMC, 台積電) US$12 billion chip fabrication plant in Arizona would be key to spurring greater US production of core semiconductor components, Fitch Ratings said. “We view the US-TSMC alliance as a first step in building a more autonomous US technology supply chain, given high barriers to entry, specifically related to the significant capital and design capability required for leading-edge semiconductor manufacturing,” Fitch said in a statement on Tuesday. “By working with TSMC, US chipmakers will not face the financial burden of incremental investment