Semiconductor report helps TAIEX

The TAIEX rose for a second day, led by United Microelectronics Corp (UMC, 聯電), on hopes semiconductor makers would be among the first to benefit from an economic recovery after an industry report said global chip sales fell at a slower pace in September.

Computer memory-chip makers gained on a report Germany's Infineon Technologies AG is in possible merger talks with Mosel Vitelic Inc (茂矽電子), Winbond Electronics Corp (華邦電子) and Nanya Technology Corp (南亞科技).

"The worst is over in the made-to-order chipmaking sector," said Bryan Chiang, who manages NT$500 million (US$15 million) in stocks at Invesco Taiwan Ltd.

"If consumer demand rises in the US before Christmas, that would be good news for Taiwan stocks," he said.

The TAIEX rose 68.79, or 1.8 percent, to 3,998.48, though it finished the week down 1.1 percent. Within the index, 347 stocks rose and 117 fell. The total value of trade was NT$65.8 billion (US$1.9 billion), 42 percent higher than the six-month daily average.

Chipmakers rose after their US peers advanced on optimism they'll be among the first to benefit from reviving demand for personal computers and other electronics products.

UMC, whose American depositary receipts (ADRs) climbed 8.8 percent to US$6.20, rose NT$2, or 6.9 percent, to NT$31.10. Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), whose ADRs rose 2.8 percent to US$13.27 yesterday, rose NT$1.50, or 2.5 percent, to NT$62.50.

Computer memory-chip makers rose after the Financial Times Deutschland said Infineon Technologies AG is in talks with Mosel, Winbond and Nanya about a possible merger. Winbond, Taiwan's largest computer memory-chip maker by market value, rose NT$0.20, or 1.8 percent, to NT$11.45.

Nanya, the second-largest, rose NT$0.40, or 4.5 percent, to NT$9.35. Mosel rose as much as 4.4 percent before finishing unchanged at NT$5.75.

Financial stocks rose on optimism lower interest rates will boost borrowing by consumers and companies. The US Federal Reserve is expected to cut interest rates for a tenth time this year when it holds its regular meeting next week. Taiwan last cut rates on Oct. 3.

China Development Industrial Bank (中華開發銀行), the largest bank by market value, rose NT$0.20, or 1.1 percent, to NT$18.60. First Commercial Bank (第一銀行), the fourth-largest, rose NT$0.20, or 1.2 percent, to NT$17.40.

Hua Nan Commercial Bank (華南銀行), the second- largest lender by assets, rose NT$0.10, or 0.6 percent, to NT$17.40.

Formosa Plastics Corp (台塑), Taiwan's biggest plastics maker, fell NT$0.30, or 1.1 percent, to NT$27.30 after local media reported Formosa Group chairman Wang Yung-ching (王永慶) said he may sell the group's stake in a power plant in China after admitting the investment was a mistake.

Inventec Co (英業達) rose 6.7 percent, or NT$1.10, to NT$17.60. The company received an order from Apple Computer Inc for I-Pod handheld music players, with shipments starting in the fourth quarter, local media reported.

MediaTek Inc (聯發科技) rose NT$12, or 3.8 percent, to NT$328. Taiwan's second-largest chip designer's fourth-quarter sales should be a record, and profit margins should remain at about 50 percent, local media reported.

Silicon Integrated Systems Co (矽統) rose NT$2.40, or 6.6 percent, to NT$38.90. Taiwan's second-largest chipset maker said October sales rose almost a fifth on year and a tenth from September to NT$1 billion.