The recently thriving local bourse is expected to continue its upward momentum with the benchmark index hitting a peak of around 6,800 points in the upcoming quarter, pushed by a boost of capital and recovering high-tech stocks, the UBS Securities Ltd Taiwan Branch said yesterday.
"From now to the year's-end, we expect the benchmark index to fluctuate between 6,000 points and 6,700 points to 6,800 points, and end up at about 6,300 points or 6,400 points," Ken Chen (
Chen expects foreign investors, who have been attracted by the re-weighting of the TAIEX by Morgan Stanley Capital International (MSCI) Inc on May 31, to keep pouring funds into the local bourse, while local institutional investors have also been more upbeat on the local stock market.
Boosted by the MSCI reweighting, foreign investors have bought a net of NT$90.4 billion in Taiwanese stocks this month and NT$126.6 billion last month, compared to a net sale of just NT$24.7 billion in April.
In terms of the bank's favorite sectors, "we like tech now," Chen said, adding that it expects the high-tech sector to enjoy strong growth momentum after inventory cutbacks in the personal computer and semiconductor industries.
The analyst suggested that investors set their sights on second-tier players rather than first-tier firms in a handful of high-tech segments, like flat panels or notebooks.
Non-tech sectors like steel and chemicals are now at the peak of their cycle, and it is tough to say how long the upside will linger, Chen said. Finance stocks are not so appealing, due to a slow pace of consolidation that failed to excite investors, he said.
Chen made the remarks at yesterday's media briefing after the Swiss securities house wrapped up the two-day UBS Taiwan Conference, which drew about 200 overseas institutional investors from the US, Europe and other Asian countries to meet with over 60 local companies.
The participating Taiwanese firms were from a range of sectors including high-tech, financial and oil and gas, and included BenQ Corp (
Unlike the past focus on manufacturing, overseas investors showed high interest in Taiwanese companies' branding efforts and merger and acquisitions issues, UBS Securities Taiwan Branch's managing director Michael Chin said.
Taiwanese companies' China strategy was another point of interest for foreign investors, as Taiwanese firms' better flexibility and transparency is a nice proxy for foreigners who want to invest in China's huge growth potential, Chin added.
NOT JUSTIFIED: The bank’s governor said there would only be a rate cut if inflation falls below 1.5% and economic conditions deteriorate, which have not been detected The central bank yesterday kept its key interest rates unchanged for a fifth consecutive quarter, aligning with market expectations, while slightly lowering its inflation outlook amid signs of cooling price pressures. The move came after the US Federal Reserve held rates steady overnight, despite pressure from US President Donald Trump to cut borrowing costs. Central bank board members unanimously voted to maintain the discount rate at 2 percent, the secured loan rate at 2.375 percent and the overnight lending rate at 4.25 percent. “We consider the policy decision appropriate, although it suggests tightening leaning after factoring in slackening inflation and stable GDP growth,”
DIVIDED VIEWS: Although the Fed agreed on holding rates steady, some officials see no rate cuts for this year, while 10 policymakers foresee two or more cuts There are a lot of unknowns about the outlook for the economy and interest rates, but US Federal Reserve Chair Jerome Powell signaled at least one thing seems certain: Higher prices are coming. Fed policymakers voted unanimously to hold interest rates steady at a range of 4.25 percent to 4.50 percent for a fourth straight meeting on Wednesday, as they await clarity on whether tariffs would leave a one-time or more lasting mark on inflation. Powell said it is still unclear how much of the bill would fall on the shoulders of consumers, but he expects to learn more about tariffs
Greek tourism student Katerina quit within a month of starting work at a five-star hotel in Halkidiki, one of the country’s top destinations, because she said conditions were so dire. Beyond the bad pay, the 22-year-old said that her working and living conditions were “miserable and unacceptable.” Millions holiday in Greece every year, but its vital tourism industry is finding it harder and harder to recruit Greeks to look after them. “I was asked to work in any department of the hotel where there was a need, from service to cleaning,” said Katerina, a tourism and marketing student, who would
i Gasoline and diesel prices at fuel stations are this week to rise NT$0.1 per liter, as tensions in the Middle East pushed crude oil prices higher last week, CPC Corp, Taiwan (台灣中油) and Formosa Petrochemical Corp (台塑石化) said yesterday. International crude oil prices last week rose for the third consecutive week due to an escalating conflict between Israel and Iran, as the market is concerned that the situation in the Middle East might affect crude oil supply, CPC and Formosa said in separate statements. Front-month Brent crude oil futures — the international oil benchmark — rose 3.75 percent to settle at US$77.01
RSS