UMC leads shares higher after US chipmakers rise

Taiwan stocks rose as chipmakers such as United Microelectronics Corp (UMC, 聯電) tracked gains in their US peers after the Philadelphia Semiconductor Index advanced for the first day in five.

TAIEX Index rose 162.27, or 3 percent, to 5562.23, its biggest percentage gain since March 11. Within the index, about five stocks rose for every one that fell. The total value of trade was NT$104.4 billion (US$3.1 billion), the highest since April 25, though still a tenth below the six-month daily average of NT$115.3 billion.

The TAIEX Electronics Index has fallen a fifth since April 22, compared with a 14 percent decline in the main index, on concern slowing computer and mobile-phone sales will damp demand for the semiconductors used to run them.

"We can't see a revival in demand, but semiconductor stocks are attractive at this price," said Bryan Chiang, who helps manage NT$1.8 billion (US$53 million) in stocks at Invesco Taiwan Ltd

(景順投信).

UMC, whose US-traded shares rose 1.8 percent yesterday, added NT$1.9, or 4.6 percent, to NT$43.5. The world's second-largest made-to-order chipmaker also gained after it signed a five-year agreement to supply semiconductors to Micronas Semiconductor Holding AG, the largest Swiss computer-chip maker.

Asia Cement Corp (亞洲水泥) rose NT$0.05, or 0.4 percent, to NT$13.7. The nation's second-largest cement maker by market value said it plans to invest a further US$20 million in a cement-making plant in China.

Benq Corp (明基電通), Taiwan's largest mobile-phone maker which makes handsets for Motorola Inc, rose NT$3, or 5.3 percent, to NT$59.50. Motorola, the world's second-largest handset maker, said it will meet or exceed forecasts for sales this quarter.

China Motor Co (中華汽車) rose NT$1.80, or 5.4 percent, to NT$35.30. The company may raise its 2002 profit forecast on Wednesday, a Chinese-language newspaper reported. China Motor reported pretax profit of NT$2.78 billion in the first five months, almost reaching its 2002 target of NT$2.8 billion.

Far Eastern Textile Ltd (遠東紡織) surged NT$1, or 6.8 percent, to NT$15.7 after local media reported that Taiwan's second-biggest textile maker by market value will boost its polyester production capacity in China to 350,000 tons a year. Far Eastern Textile's planned purchase of DuPont Co's plant in Suzhou will make it China's second-biggest maker of polyester after Sinopec Yizheng Chemical Fibre Co (中國石化儀征化纖).

Hua Nan Financial Holdings Co (華南金控) rose NT$1.7, or 6.6 percent, to NT$27.4 following reports the company's banking unit wrote off NT$45.7 billion (US$1.3 billion) of bad loans last month, cutting its non-performing loan ratio to 4.1 percent from 9.2 percent.

Nan Ya Plastic Corp (南亞塑膠) rose NT$0.4, or 1.2 percent, to NT$32.7. The unit of Formosa Plastics Group (台塑集團) plans to sell as many as 80 million shares of its Nanya Technology Corp (南亞科技) unit to overseas investors, raising as much as NT$2.7 billion.

Taichung Commercial Bank (台中銀行) rose 40 cents, or 6.1 percent, to NT$6.95 after the lender said it expects to post a 2002 profit of NT$124.3 million, three-quarters more than last year's profit.

Taishin Financial Holdings Co (台新金控) rose NT$1.2, or 6.5 percent, to NT$19.6 after the company said its bank unit, Taiwan's second-largest credit card issuer, will sell NT$3.1 billion (US$91 million) of subordinated bonds to raise its capital-adequacy ratio.