The TAIEX yesterday surged 755.23 points, or 2.57 percent, to 30,105.04, decisively breaching the 30,000-point mark on the back of investor optimism over earnings in the technology sector, early-year portfolio repositioning and supportive cues from global markets.
The advance was led by shares of semiconductor and high-end hardware makers, reflecting expectations of further gains ahead of the Lunar New Year holiday.
PGIM Inc said that market enthusiasm largely stemmed from anticipation of strong fourth-quarter earnings delivered by semiconductor giants and forecasts of more capital expenditure on advanced processes this year.
Photo: CNA
“The rally reflects optimism about sustained demand for advanced technologies and local conviction in the market, despite [a] slowdown in other sectors,” PGIM said in a note.
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s largest contract chipmaker whose clients include Nvidia Corp, Apple Inc and Intel Corp, was the primary driver of yesterday’s rise, closing 5.36 percent higher at NT$1,670, a new record.
“The strong interest in TSMC came as investors were betting the chipmaker would continue to benefit from global strong demand for its advanced processes, in particular, after its 2-nanometer process has started mass production during the current artificial intelligence boom,” Hua Nan Securities Co (華南永昌證券) analyst Kevin Su (蘇俊宏) said.
Gains in TSMC reverberated across the technology ecosystem, lifting equipment makers, IC designers and memory suppliers, amplifying overall market momentum.
MediaTek Inc (聯發科) shares rose 3.74 percent, ASE Technology Holding Co (日月光投控) shares gained 2.13 percent and United Integrated Services Co (漢唐集成) shares advanced 3.33 percent.
“With electronics stocks attracting most of the market attention, non-tech stocks largely traded in weakness,” Su said. “The silver lining was that the financial sector stayed resilient.”
Cathay Financial Holding Co (國泰金控) shares rose 1.73 percent and Fubon Financial Holding Co (富邦金控) shares added 1.67 percent.
Trading activity was notably heavy, with turnover totaling NT$765.807 billion (US$24.28 billion), the second-highest level on record after NT$782.83 billion on May 12, 2021, Taiwan Stock Exchange data showed, underscoring the eagerness of both retail and institutional investors to capitalize on early-year opportunities.
Domestic funds and proprietary traders were the main sources of buying, with proprietary traders contributing a net NT$10.75 billion. Foreign investors, by contrast, were net sellers at NT$7.64 billion, while investment trusts added a modest NT$790 million, exchange data showed.
Seasonal factors also supported the rally. Historically, Taiwan sees inflows early in the year as portfolio rebalancing and dividend expectations come into focus.
Favorable macroeconomic conditions further reinforced investor sentiment. Global equity markets, particularly US technology stocks, remained resilient, bolstering risk appetite across Asia and lending confidence to Taiwanese investors, analysts said.
With a series of potential corporate and macroeconomic catalysts on the horizon, the momentum could continue, analysts said.
Additional reporting by CNA
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