Tue, Oct 30, 2007 - Page 1 News List

Local bourse soars to seven-year high

NEXT HURDLE Buoyed by the index's rise to its highest point since the DPP took over, investor expectations are high that the TAIEX could soon challenge the 10,000 mark

AGENCIES , TAIPEI

The TAIEX rose 178.37 points, or 1.9 percent, to close at 9,809.88 points yesterday -- - its highest since April 2000 -- boosted by a Wall Street rally at the end of last week and strong third-quarter earnings and fourth-quarter guidance from electronics companies.

Yesterday's close was also the best after the Democratic Progressive Party came to power, fueling investors' expectation that the local bourse would soon challenge the 10,000 point level.

Risers led decliners 1,319 to 726, with 245 stocks unchanged.

A total of 53 stocks closed limit-up and seven limit-down.

Cecelia Lu of Taiwan International Securities (金鼎證券) said Taiwan shares were boosted by various factors.

"Investor demand has returned to electronics shares," Lu said. "And the significant appreciation of the [New] Taiwan dollar of late also increased demand for asset-rich companies."

Several major stocks' gains led yesterday's seven-year record.

Hon Hai Precision Industry Co (鴻海精密), the nation's biggest electronics exporter, added NT$5, or 2 percent, to NT$250. Hon Hai makes iPods for Apple Inc.

Hon Hai paced exporters' gains amid speculation that the worst of the US subprime mortgage crisis was over.

In the US, third-quarter sales at Microsoft Corp beat projections by more than US$1 billion, the world's largest software company said on Thursday. Countrywide Financial Corp, the No. 1 US mortgage lender, said on Friday that last quarter was its "earnings trough'' and that it would return to profit in the current period.

"Corporate earnings are sustainable and will keep the US economy from slowing," said Yin Nai-yun (尹乃芸), who oversees US$172 million at Prudential Securities Investment Trust Enterprise (保德信元富投信) in Taipei. "That provides support for stocks worldwide."

Taiwan Semiconductor Manu-facturing Co (TSMC, 台積電), the world's largest contract chipmaker, advanced NT$2.30, or 3.7 percent, to NT$63.90. TSMC makes about three quarters of its sales to the US.

Acer, the world's fourth-largest computer vendor, jumped NT$4.90, or 6.7 percent, to NT$78.10. Acer chairman Wang Jeng-tang (王振堂) said on Thursday that the firm's sales this quarter would increase from the previous three-month period, with shipments climbing as much as 20 percent, on orders for notebook computers.

United Microelectronics Corp (聯電), the world's second-largest contract chipmaker, advanced NT$0.85, or 4.1 percent, to NT$21.85. Robert Tsao (曹興誠), the company's former chairman, was cleared on Friday of breach of trust and violating accounting laws for helping Chinese chipmaker He Jian Technology (Suzhou) Co (和艦) without compensation.

In addition, Formosa Plastics Corp (台塑), the world's second-largest maker of polyvinyl chloride, climbed NT$1.50, or 1.5 percent, to NT$99.40. Formosa Plastics' profit in the third quarter surged 65 percent to NT$20.1 billion (US$619 million) from a year earlier. The figure was derived by deducting first-half profit from nine-month earnings the company announced on Friday.

Fubon Financial Holding Co (富邦金控), the second-largest local financial company by market value, gained US$0.85, or 2.8 percent, to NT$31.50. Fubon plans to set up an insurance unit in China through a joint venture, the Chinese-language Commercial Times reported on Saturday, citing property insurer Fubon Insurance Co (富邦產險) president Chen Tsan-huang (陳燦煌).

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