Asian shares rose for a fifth week, the longest winning streak since March, as Japan’s Liberal Democratic Party (LDP) regained power on pledges to boost economic stimulus and the country’s central bank added to asset purchases. Stocks pared gains as US budget talks stalled.
The MSCI Asia Pacific Index advanced 0.7 percent to 128.30 this week, closing on Wednesday at it highest since August last year. Japanese shares led gains as the yen weakened after the LDP captured 294 seats in the 480-member lower house of Japanese parliament in elections last week.
“This is going to have a tremendous impact on the fortunes of Japanese exporters and the economy,” Ed Rogers, chief executive officer at Tokyo-based Rogers Investment Advisors, said in a Bloomberg Television interview.
Asia’s benchmark equities index rose about 18 percent from this year’s low on June 4 as central banks from the US, Europe, Japan and China took action to spur economic growth. The gauge traded at 14.6 times average estimated earnings compared with 13.9 for the Standard & Poor’s 500 Index and 12.8 times for the STOXX Europe 600 Index, data compiled by Bloomberg show.
Japan’s Nikkei 225 Stock Average advanced 2.1 percent this week. The Nikkei 225 has risen about 15 percent since Nov. 14, when the Japanese previous government said it would call elections. Shares climbed on expectations that the LDP will spend more to boost growth and push for a looser monetary policy.
Australia’s S&P/ASX 200 rose 0.9 percent. New Zealand’s NZX 50 Index gained 1.9 percent in Wellington. Hong Kong’s Hang Seng Index dropped 0.4 percent. The Shanghai Composite Index, which tracks stocks on the larger Chinese exchanges, added 0.1 percent.
Among benchmarks that declined, South Korea’s KOSPI fell 0.7 percent. The ruling New Frontier Party’s Park Geun-hye was elected president of South Korea on Thursday, becoming the first woman to lead Asia’s No. 4 economy.
In Taiwan, the TAIEX retreated 2.3 percent this week. Shares on the Taiwan Stock Exchange staged a technical rebound yesterday, but trading was light as many foreign investors were away for the weekend, dealers said. While select large-cap stocks, in particular in the high-tech sector, attracted bargain hunters, the gains were limited amid lingering concerns over a pending “fiscal cliff” in the US, dealers said.
In the rare Saturday session, held to make up for a session that will be lost during the extended New Year’s holiday, the market’s weighted index closed up 20.21 points, or 0.26 percent, at 7,540.14, after moving between 7,520.80 and 7,546.90. Turnover was an anemic NT$40.52 billion (US$1.39 billion), the lowest in a single trading session since Jan. 19, 2009.
The market opened up 0.23 percent and moved to the day’s high as bargain hunting focused on certain electronics heavyweights, like Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) and Hon Hai Precision Industry Co Ltd (鴻海精密), which assembles iPads and iPhones for Apple Inc, dealers said. Yet as the TAIEX moved closer to the 7,600 point mark, selling took over to cap the day’s gains, reflecting investors’ concerns over the US, they said.
The fiscal cliff refers to the US$500 billion in expiring tax cuts and automatic spending reductions that will start in the US on Jan. 1 if alternative deficit-cutting measures are not adopted.
“Many investors here are afraid that Wall Street will encounter further volatility due to the fiscal problems,” Mirae Asset Management analyst Arch Shih (施博元) said.
However, Shih added that because many foreign investors were absent from yesterday’s session, the low trading volume could not be used to draw a definitive conclusion on the direction of future trading.
Among the winning high-tech stocks in Taiwan yesterday was TSMC, the world’s largest contract chip maker, which gained 0.95 percent to close at NT$95.70, and Hon Hai, which added 1.26 percent to end at NT$88.10.
The paper and pulp sector scored the highest gains among the eight major sectors of the market, finishing up 2.2 percent. Machinery and electronics shares rose 0.6 percent, financial stocks added 0.4 percent, and the textile and construction sectors each closed up 0.3 percent. Bucking the broader market, cement stocks fell 1.0 percent, and food shares and plastics and chemical stocks ended down 0.3 percent.
In other markets on Friday:
Manila closed 0.45 percent higher from Thursday, adding 26.20 points to 5,823.94.
Wellington fell 0.51 percent, or 20.71 points, to 4,054.74.
Mumbai fell 1.09 percent, or 211.92 points, to 19,242.0 points.
IN THE AIR: While most companies said they were committed to North American operations, some added that production and costs would depend on the outcome of a US trade probe Leading local contract electronics makers Wistron Corp (緯創), Quanta Computer Inc (廣達), Inventec Corp (英業達) and Compal Electronics Inc (仁寶) are to maintain their North American expansion plans, despite Washington’s 20 percent tariff on Taiwanese goods. Wistron said it has long maintained a presence in the US, while distributing production across Taiwan, North America, Southeast Asia and Europe. The company is in talks with customers to align capacity with their site preferences, a company official told the Taipei Times by telephone on Friday. The company is still in talks with clients over who would bear the tariff costs, with the outcome pending further
A proposed 100 percent tariff on chip imports announced by US President Donald Trump could shift more of Taiwan’s semiconductor production overseas, a Taiwan Institute of Economic Research (TIER) researcher said yesterday. Trump’s tariff policy will accelerate the global semiconductor industry’s pace to establish roots in the US, leading to higher supply chain costs and ultimately raising prices of consumer electronics and creating uncertainty for future market demand, Arisa Liu (劉佩真) at the institute’s Taiwan Industry Economics Database said in a telephone interview. Trump’s move signals his intention to "restore the glory of the US semiconductor industry," Liu noted, saying that
NEGOTIATIONS: Semiconductors play an outsized role in Taiwan’s industrial and economic development and are a major driver of the Taiwan-US trade imbalance With US President Donald Trump threatening to impose tariffs on semiconductors, Taiwan is expected to face a significant challenge, as information and communications technology (ICT) products account for more than 70 percent of its exports to the US, Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) president Lien Hsien-ming (連賢明) said on Friday. Compared with other countries, semiconductors play a disproportionately large role in Taiwan’s industrial and economic development, Lien said. As the sixth-largest contributor to the US trade deficit, Taiwan recorded a US$73.9 billion trade surplus with the US last year — up from US$47.8 billion in 2023 — driven by strong
STILL UNCLEAR: Several aspects of the policy still need to be clarified, such as whether the exemptions would expand to related products, PwC Taiwan warned The TAIEX surged yesterday, led by gains in Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), after US President Donald Trump announced a sweeping 100 percent tariff on imported semiconductors — while exempting companies operating or building plants in the US, which includes TSMC. The benchmark index jumped 556.41 points, or 2.37 percent, to close at 24,003.77, breaching the 24,000-point level and hitting its highest close this year, Taiwan Stock Exchange (TWSE) data showed. TSMC rose NT$55, or 4.89 percent, to close at a record NT$1,180, as the company is already investing heavily in a multibillion-dollar plant in Arizona that led investors to assume
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