Share prices closed up 1.20 percent in Taipei yesterday on high hopes that Taiwan and China will soon sign an economic cooperation framework agreement (ECFA) after the two sides reached a consensus on the text of the accord over the weekend, dealers said.
The TAIEX rose 87.91 points to 7,387.40 after moving between 7,347.23 and 7,393.41, with turnover of NT$68.52 billion (US$2.11 billion).
The market opened 1.01 percent higher, in line with other regional markets boosted by Wall Street’s gains at the end of last week and the momentum accelerated as investors turned upbeat about Taiwan’s potential economic outlook after the proposed ECFA is signed, dealers said.
“The negotiations seem to have proceeded smoothly, prompting investors to leave behind earlier concerns that the agreement would not be signed in the middle of this year as scheduled,” said Henry Miao (苗台生), vice president of Hua Nan Securities Investment Management Co (華南永昌投顧).
Both the plastics and chemical and the textile sectors attracted large buying as investors anticipate the sectors will be included in the “early harvest” list, Miao said.
“However, I do not expect the local bourse will have much upside room ahead of the nearest technical resistance of 7,500 points unless Wall Street continues to make significant gains,” he said.
“In addition, concerns over the debt problems in Europe remain in place,” he said. “So, it won’t be easy for the market to overcome the technical hurdles anytime soon.”
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