Local shares on Friday moved higher to overcome stiff technical resistance ahead of 10,400 points as the bellwether electronics sector continued to steam ahead, led by contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), dealers said.
The old economy sector also attracted buying as bargain hunters rushed to pick up stocks in the sector, which has lagged behind the high-tech sector, as well as the broader market, for some time, dealers added.
The TAIEX on Friday closed up 90.59 points, or 0.88 percent, at the day’s high of 10,439.24, after rebounding from a low of 10,370, on turnover of NT$152.996 billion (US$4.95 billion).
That was a 1.9 percent gain from a close of 10,241.75 on March 8.
The market opened up 0.25 percent as investors shrugged off a sluggish Wall Street, where the Dow Jones Industrial Average closed up 0.03 percent and the tech heavy NASDAQ ended down 0.16 percent overnight, dealers said.
Buying accelerated on the local main board as TSMC, the most heavily weighted local stock, moved higher to lead the semiconductor sector and the entire electronics sector to post gains, while old economy stocks in the petrochemical and textile sectors were favored by bargain hunters, pushing the TAIEX up to the day’s high at the end of the session, they said.
“TSMC’s gains show that foreign institutional investors tend to push up the index on the spot market in a bid to profit in the futures market, as they still own a large chunk of long position futures contracts,” Mega International Investment Services Corp (兆豐國際投信) analyst Alex Huang (黃國偉) said.
Foreign institutional investors own a net total of about 60,000 long position futures contracts, a high level indicating that they are upbeat about the spot market, Huang said.
TSMC rose 1.92 percent to close at NT$239, with 33.62 million shares changing hands. The upturn enjoyed by TSMC boosted the TAIEX by about 45 points and lifted the electronics sector by 0.82 percent.
Among other electronics stocks, United Microelectronics Corp (聯電), a smaller rival of TSMC, added 1.75 percent to end at NT$11.65, while IC designer MediaTek Inc (聯發科) gained 1.28 percent to close at NT$276.
“Turnover expanded to more than NT$150 billion, so I suspect foreign institutional investors stood on the buy side,” Huang said.
Foreign institutional investors on Friday bought a net NT$5.58 billion of shares on the main board, Taiwan Stock Exchange data showed.
The non-tech sector also rode the wave of strong buying, as “many old economy stocks appeared relatively cheap, attracting bargain hunters,” Huang said.
In the textile sector, Eclat Textile Co (儒鴻) rose 5.13 percent to close at NT$420.50 and Makalot Industrial Co (聚陽) gained 4.3 percent to end at NT$206.
On the back of the rebound staged by international crude oil prices, Formosa Plastics Corp (台灣塑膠) rose 1.44 percent to close at NT$105.50 and Formosa Petrochemical Corp (台塑石化) added 3.57 percent to end at NT$116.
“Despite today’s [Friday’s] gains, the main board is expected to face high technical hurdles ahead of the 240-day moving average of about 10,450 points, so the room for a further upturn will be limited in the short term,” Huang said.
Investors need to pay close attention to a policymaking meeting scheduled by the US Federal Reserve for next week, while ongoing trade talks between the US and China are expected to continue to move global financial markets, Huang added.
Elsewhere in Asia on Friday, markets rose as US President Donald Trump struck an upbeat note on trade talks with China.
While there remain some concerns about the global outlook, investor confidence has been supported by ongoing optimism that the world’s two biggest economies will eventually hammer out a deal to end their long-running trade row.
The US president provided fresh cheer on Thursday by telling reporters that “we are doing very well with China talks,” adding that “we are getting what we have to get.”
“One way or the other, we’re going to know over the next three to four weeks,” Trump said.
His comments came as Chinese state media said that telephone talks had been held by Beijing’s top negotiator, Chinese Vice Premier Liu He (劉鶴), with US Trade Representative Robert Lighthizer and US Secretary of the Treasury Steven Mnuchin.
Mnuchin earlier on Thursday said that he expects the deal to be finalized soon, but cautioned that the process is complex.
Trump had said that he expected to hold a meeting in Florida with Chinese President Xi Jinping (習近平) later this month, but Bloomberg said that the “signing summit” had been pushed back a month as negotiators struggled to resolve their differences.
On Friday, China approved a foreign investment law that would abolish the forced transfer of technology from foreign firms to local joint venture partners, addressing a key point of anger in the White House.
At the end of the annual session of the rubber-stamp Chinese National People’s Congress, Chinese Premier Li Keqiang (李克強) promised not to let the world’s second-largest economy “slip out of a reasonable range” and pledged support, such as interest rate cuts.
The developments helped boost equities in the region.
Tokyo’s Nikkei 225 on Friday ended up 163.83 points, or 0.8 percent, at 21,450.85, jumping 2 percent from 21,025.56 on March 8.
Hong Kong’s Hang Seng on Friday rose 160.87 points, or 0.6 percent, to 29,012.26, a 2.8 percent surge from 28,228.42 a week earlier.
The Shanghai Composite on Friday closed up 31.07 points, or 1 percent, at 3,021.75, an increase of 1.7 percent from 2,969.86 on March 8.
Seoul’s KOSPI on Friday gained 20.43 points, or 1 percent, to 2,176.11, rising 1.8 percent from a close of 2,137.44 a week earlier.
Singapore, Wellington, Mumbai and Jakarta also closed up, but Sydney ended marginally lower.
While traders remain uneasy about the global economy, there is some optimism.
“There is a pretty good backdrop going forward,” Wells Fargo Asset Management portfolio manager Margaret Patel said.
“We’re in a low-inflation environment for the foreseeable future and that really changes the equation about equity values — they can go higher. The Fed isn’t going to do much and inflation remains stubbornly low,” she told Bloomberg TV.
Taiwan Transport and Storage Corp (TTS, 台灣通運倉儲) yesterday unveiled its first electric tractor unit — manufactured by Volvo Trucks — in a ceremony in Taipei, and said the unit would soon be used to transport cement produced by Taiwan Cement Corp (TCC, 台灣水泥). Both TTS and TCC belong to TCC International Holdings Ltd (台泥國際集團). With the electric tractor unit, the Taipei-based cement firm would become the first in Taiwan to use electric vehicles to transport construction materials. TTS chairman Koo Kung-yi (辜公怡), Volvo Trucks vice president of sales and marketing Johan Selven, TCC president Roman Cheng (程耀輝) and Taikoo Motors Group
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
RECORD-BREAKING: TSMC’s net profit last quarter beat market expectations by expanding 8.9% and it was the best first-quarter profit in the chipmaker’s history Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), which counts Nvidia Corp as a key customer, yesterday said that artificial intelligence (AI) server chip revenue is set to more than double this year from last year amid rising demand. The chipmaker expects the growth momentum to continue in the next five years with an annual compound growth rate of 50 percent, TSMC chief executive officer C.C. Wei (魏哲家) told investors yesterday. By 2028, AI chips’ contribution to revenue would climb to about 20 percent from a percentage in the low teens, Wei said. “Almost all the AI innovators are working with TSMC to address the
FUTURE PLANS: Although the electric vehicle market is getting more competitive, Hon Hai would stick to its goal of seizing a 5 percent share globally, Young Liu said Hon Hai Precision Industry Co (鴻海精密), a major iPhone assembler and supplier of artificial intelligence (AI) servers powered by Nvidia Corp’s chips, yesterday said it has introduced a rotating chief executive structure as part of the company’s efforts to cultivate future leaders and to enhance corporate governance. The 50-year-old contract electronics maker reported sizable revenue of NT$6.16 trillion (US$189.67 billion) last year. Hon Hai, also known as Foxconn Technology Group (富士康科技集團), has been under the control of one man almost since its inception. A rotating CEO system is a rarity among Taiwanese businesses. Hon Hai has given leaders of the company’s six