Sun, Sep 01, 2019 - Page 14 News List

TAIEX soars on better sentiment

DETENTE:Beijing pausing on a cycle of tit-for-tat tariffs renewed investors’ hopes for successful US-China trade talks this month, boosting most regional markets

Staff writer, with CNA and AFP

Local shares on Friday surged more than 150 points, with investors encouraged by a strong showing on US markets overnight amid reduced concerns over trade frictions between the US and China after Beijing indicated that it would not retaliate for the moment over the latest round of tariffs from Washington, dealers said.

Improved sentiment prompted local investors to chase prices throughout the session, boosting turnover and pushing the local main board to close at above 10,600 points, they said.

The bellwether electronics sector led the upturn on the back of solid buying in “Apple concept” stocks on expectations that the US consumer electronics giant will unveil its next generation of iPhones on Sept. 10, dealers said.

The TAIEX on Friday ended up 155.62 points, or 1.49 percent, at 10,618.05, a gain of 0.8 percent from 10,538.11 a week earlier, after moving between 10,504.28 and 10,618.05, on turnover of NT$147.13 billion (US$4.68 billion).

The market opened up 0.4 percent in a reaction to gains on the US markets, where the Dow Jones Industrial Average closed up 1.25 percent and the S&P 500 ended up 1.27 percent after Chinese Ministry of Commerce spokesman Gao Feng (高峰) on Thursday said that Beijing is willing to remain calm to resolve the trade disputes with Washington and is against any escalation of bilateral tensions, dealers said.

Buying on the local main board accelerated toward the end of the session, with large-cap tech stocks, in particular in the Apple Inc supply chain, in focus, helping the weighted index overcome stiff technical resistance ahead of the 20-day moving average of 10,456 points and move even higher as old economy and financial stocks joined the upturn, they said.

“China’s attitude toward the trade disputes with the US is encouraging, in particular after US President Donald Trump threatened last week to raise duties on US$250 billion of Chinese goods from 25 percent to 30 percent and hike tariffs on an additional US$300 billion of products from 10 percent to 15 percent,” Hua Nan Securities Investment Management Co (華南投顧) analyst Kevin Su (蘇俊宏) said.

“It was no surprise that local investors rushed to hunt bargains soon after the local equity market opened today,” Su said. “It seems that market sentiment improved a lot as turnover expanded to top NT$140 billion, with more and more investors willing to trade.”

The electronics sector, which closed up 1.63 percent at the day’s high of 443.10 points, led the broader market to steam ahead as investors have high hopes that the new iPhones will boost Taiwanese suppliers’ shipments in the fourth quarter of this year, Su said.

Apple announced overnight that it would hold an event on Sept. 10. Although the US firm offered no further details, the market widely anticipates that three new iPhones will be unveiled.

Among the gaining Apple concept stocks, Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the most heavily weighted stock on the local market, rose 1.97 percent to end at the day’s high of NT$259, with 35.15 million shares changing hands.

The gains posted by TSMC contributed about 50 points to the TAIEX and boosted the semiconductor subindex by 1.75 percent.

Also in the Apple supply chain, iPhone assembler Hon Hai Precision Industry Co (鴻海精密) added 3.2 percent to close at NT$74.20 and smartphone camera lens maker Largan Precision Co (大立光) rose 1.17 percent to end at NT$3,890.

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