The nation's stocks yesterday surpassed the 8,000-point level for the first time in six-and-a-half years, with sentiment bolstered by Wall Street's overnight rally, dealers said.
The TAIEX gained 71.70 points, or 0.90 percent, to close at 8,004.61, its highest level since Aug. 25, 2000, on turnover of NT$132.972 billion (US$4.02 billion), the Taiwan Stock Exchange's tallies showed.
"Market heavyweights in both the technology and financial sectors led today's solid advance," said Alex Huang (
That the benchmark index breached 8,000 points just ahead of a long holiday reflects investor confidence that the market is ready to advance further when trading resumes after the break, he said.
Financial markets will be closed for a four-day break for the tomb-sweeping holiday, beginning today.
Foreign investors yesterday were net buyers for the fifth trading day in a row, buying shares with a net worth of NT$16.82 billion, the second-highest total this year.
International investors are expected to stay cautious as uncertainties caused by the release of financial results for the previous quarter may continue to haunt US and local markets, Mega Securities said in a report released yesterday.
There is also selling pressure, as local institutional investors could offload stocks in small and medium-sized firms to reap profits, the brokerage added.
"The upside is limited, considering the 10 percent rise from a level of 7,300 points in the benchmark index," said Clive Hsueh (薛宗傑), manager of proprietary trading at IBT Securities Co (台灣工銀證券).
Huang said that a near-term correction may follow if the benchmark index were to hit 8,050 next week, and the TAIEX could drop to as low as 7,800 later this month when first-quarter financial figures are released.
Nevertheless, with companies expected to give generally optimistic guidance for sales during the April-June period, the TAIEX could build up enough momentum to test 8,200 points, he said.
For now, IBT Securities suggested that investors focus on defensive stocks, like Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) or Formosa Plastic Group (台塑集團), which offer high cash dividends.
Mega Securities recommended flat-panel and component makers like AU Optronics Corp (
TSMC closed up NT$1.30 at NT$69.30 and United Microelectronics Corp (聯電) was up NT$0.15 at NT$19.30. AU Optronics gained NT$1.20 to NT$50.20, while Chi Mei Optoelectronics Corp (奇美電子) fell NT$0.20 to NT$35.80.
RSS