Shares rose yesterday, spurred by gains overnight on Wall Street and a share buyback plan by United Microelectronics Corp (UMC, 聯電), the world's second-largest contract chipmaker by revenue.
The TAIEX gained 85.44 points, or 1.3 percent, to 6,683.93 on turnover of NT$104.22 billion (US$3.22 billion).
UMC rose 6.8 percent to close at NT$18.8 and was also the most heavily traded stock on the main board, with 203.1 million shares traded.
"US stocks and UMC's share buyback boosted bullish sentiment today, which spilled over to the entire technology sector," David Li, a trader at Daiwa Securities SMBC-Cathay Co (大和國泰證券) said.
Buying back stocks reduces the number of outstanding shares, and can cause the value of outstanding shares to rise.
UMC said late on Wednesday that it would buy back and cancel 1 billion shares, or 5.05 percent of its outstanding shares, from Thursday to April 15, at a price range between NT$12.35 and NT$27.5 each.
Meanwhile, Taiwan Semiconductor Manufacturing Co (台積電), added 1.8 percent to close at NT$62.4.
The nation's two largest makers of thin film transistor liquid-crystal displays (TFT-LCD) advanced. The second-largest display maker, Chi Mei Optoelectronics Corp (奇美電子), got a boost from a plan by Japan's Funai Electric Co to secure a stable supply of LCD television panels, traders said.
Chi Mei Optoelectronics rose 3.4 percent to NT$52.2, and the country's largest TFT-LCD maker by revenue, AU Optronics Corp (