UMC, TSMC lead TAIEX up as prospects improve

Taiwan stocks rose, after United Microelectronics Corp (UMC, 聯電) said it's developing advanced chip technology with Texas Instruments Inc, which plans to outsource more production to meet rising demand and cut costs.

UMC, the second-largest made-to-order chipmaker, had its biggest gain in a week on optimism that it will receive orders from Texas Instruments, the world's largest maker of mobile-phone chips.

"It's a very positive sign the semiconductor industry is recovering," said Lloyd Tsai (蔡隆裕), who helps manage about US$77 million in stocks, including UMC, at Invesco Taiwan Ltd　(景順投信). "Texas increasing outsourcing to UMC is good news." Rival Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) gained after US manufacturing grew in March at the fastest pace in 14 years, boosting optimism that Taiwan's semiconductor makers will benefit from rising orders for chips used to run computers, mobile phones and other consumer products. Last week, TSMC said it will raise by more than half its planned investment this year in plants.

The TAIEX rose 57.02, or 0.9 percent, to 6243.46. Within the index, 332 stocks rose and 169 fell. The total value of trade was NT$148 billion (US$4.2 billion), a third more than the six-month daily average of NT$111 billion.

The index has risen 41 percent in the past four months on optimism a US recovery will boost orders for Taiwan electronics makers. The US is Taiwan's second-largest export market.

The following stocks made significant gains or losses.

United Microelectronics Corp rose NT$1.50, or 2.8 percent, to NT$54.50, its biggest gain since Thursday. Separately, the second-largest made-to-order chipmaker forecasts monthly sales in the second quarter will reach as much as NT$6 billion (US$171.5 million) thanks to rising orders, local-media reported, citing Chief Executive Officer John Hsuan (宣明智).

Taiwan Semiconductor Manufacturing , UMC's larger rival, rose NT$0.50, or 0.5 percent, to NT$96.

Mobile-phone parts makers rose after local-media reported reported orders for handset components are reviving.