Stocks bounce back after taking heavy losses on Monday

AFP , TAIPEI

Wed, Jan 04, 2006 - Page 11

Share prices closed 2.01 percent higher yesterday, rebounding sharply from heavy losses on Monday sparked by disappointment at President Chen Shui-bian's (陳水扁) hardline stand on relations with China, dealers said.

They said the market had opened tentatively on concerns that Chen's remarks might add to tensions with Beijing but signs that foreign investors continued to buy into Taipei, a laggard market last year, steadied sentiment.

The TAIEX rose 129.71 points to the day's high of 6,591.77, on turnover of NT$153.45 billion (US$4.7 billion). It earlier hit a low of 6,457.09.

Risers led decliners 894 to 198, with 124 stocks unchanged.

The electronics sector rose 2.50 percent with financials up 1.64 percent.

President Securities (統一證券) manager Johnny Lee attributed the gains to expectations of further liquidity inflows this month, as reflected in the currency's gains.

Lee said investors were positive on the outlook for tech stocks, but cautioned that while the rally may be sustained by fresh fund inflows, profit-taking could emerge after yesterday's advance.

Shares in Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) closed NT$1.90 higher at NT$62.90 after the company stood by its fourth quarter guidance despite some production delays.

TSMC's main rival United Microelectronics Corp (聯電) gained NT$0.20 to NT$18.40. Acer Inc rallied NT$3.00 to NT$84.50 after it booked capital gains on the sale of shares in Hon Hai Precision Industry Co (鴻海精密), which was up NT$4.50 to NT$186.00.