Taiwan stocks rose for a third day, boosted by China Development Industrial Bank (
The TAIEX gained 43.03, or 1 percent, to 4,446.62, up 7.8 percent in the week. Within the index, 270 stocks rose and 211 fell.
Taiwan's economy shrank in the third quarter at the fastest pace in at least 26 years, a government official said. GDP shrank 4.21 percent from a year earlier, said the Director General of Budget, Accounting and Statistics.
"The central bank has scope to cut rates 25 basis points but they certainly could do 50 basis points," said Mike Newton, an economist at HSBC Holdings Plc in Hong Kong.
Still, some investors may soon sell Taiwan stocks. The TAIEX's 14-day relative strength index, derived by averaging out daily gains and daily losses, rose to 72.2 yesterday -- above the reading of at least 70 which indicates it's poised to fall.
"We are going to neutral soon because the rally may come to an end," said Claudia Collu, who helps manage 180 euros (US$159 million) in emerging-market investments at Gruppo Monte Paschi Asset Management in Milan. She said she may sell some TSMC shares after buying the stock last month.
Monte Paschi uses their own technical analysis and the Bloomberg's relative strength index to determine when to buy and sell.
The total value of trade yesterday was NT$110.7 billion (US$3.2 billion), the biggest since April 19.
Banks gained on hopes another interest rate cut by the central bank will help companies meet their debt obligations and lessen their non-performing loans. Non-performing loans rose to NT$1.66 trillion, or 7.8 percent of outstanding credits, in September, the central bank said earlier this month.
China Development Industrial Bank, the nation's biggest lender by market value, rose NT$0.10 cents, or 0.5 percent, to NT$18.60. First Commercial Bank (
Hua Nan Commercial Bank (
Made-to-order chipmakers rose after their US shares gained. Taiwan Semiconductor Manufacturing Co's (TSMC, 台積電) Taiwan shares and US shares have a 0.9 percent correlation over 12 months, which indicates they move in tandem. United Microelectronics Corp's (UMC, 聯電) Taiwan shares and US shares have a correlation of 0.9 percent.
TSMC, the biggest made-to-order chipmaker, rose NT$3, or 4 percent, to NT$77.50. UMC, the second-biggest made-to-order chipmaker, rose NT$0.70, or 1.9 percent, to NT$38.60.
Transport shares gained after the price of crude oil fell to a two-and-a-half-year low, helping companies trim costs.
China Airlines Co (
Computer-parts makers gained after Dell Computer Corp., the biggest personal-computer maker, said sales and profit this quarter will be in line with expectations. Dell expects companies to begin buying more computers by the middle of next year, boosting hopes that Taiwan computer makers will improve their profits.
Hon Hai Precision Industry Ltd. (鴻海精密) rose NT$1, or 0.7 percent, to NT$155. VIA Technologies Inc (威盛電子) rose NT$5, or 4.4 percent, to NT$117.50. Compal Electronics Inc (仁寶電腦) rose NT$0.20, or 0.6 percent, to NT$31.50.
Chunghwa Telecom Ltd (
TYPHOON: The storm’s path indicates a high possibility of Krathon making landfall in Pingtung County, depending on when the storm turns north, the CWA said Typhoon Krathon is strengthening and is more likely to make landfall in Taiwan, the Central Weather Administration (CWA) said in a forecast released yesterday afternoon. As of 2pm yesterday, the CWA’s updated sea warning for Krathon showed that the storm was about 430km southeast of Oluanpi (鵝鑾鼻), Taiwan’s southernmost point. It was moving in west-northwest at 9kph, with maximum sustained winds of 119kph and gusts of up to 155kph, CWA data showed. Krathon is expected to move further west before turning north tomorrow, CWA forecaster Wu Wan-hua (伍婉華) said. The CWA’s latest forecast and other countries’ projections of the storm’s path indicate a higher
SLOW-MOVING STORM: The typhoon has started moving north, but at a very slow pace, adding uncertainty to the extent of its impact on the nation Work and classes have been canceled across the nation today because of Typhoon Krathon, with residents in the south advised to brace for winds that could reach force 17 on the Beaufort scale as the Central Weather Administration (CWA) forecast that the storm would make landfall there. Force 17 wind with speeds of 56.1 to 61.2 meters per second, the highest number on the Beaufort scale, rarely occur and could cause serious damage. Krathon could be the second typhoon to land in southwestern Taiwan, following typhoon Elsie in 1996, CWA records showed. As of 8pm yesterday, the typhoon’s center was 180km
TYPHOON DAY: Taitung, Pingtung, Tainan, Chiayi, Hualien and Kaohsiung canceled work and classes today. The storm is to start moving north this afternoon The outer rim of Typhoon Krathon made landfall in Taitung County and the Hengchun Peninsula (恆春半島) at about noon yesterday, the Central Weather Administration (CWA) said, adding that the eye of the storm was expected to hit land tomorrow. The CWA at 2:30pm yesterday issued a land alert for Krathon after issuing a sea alert on Sunday. It also expanded the scope of the sea alert to include waters north of Taiwan Strait, in addition to its south, from the Bashi Channel to the Pratas Islands (Dongsha Islands, 東沙群島). As of 6pm yesterday, the typhoon’s center was 160km south of
STILL DANGEROUS: The typhoon was expected to weaken, but it would still maintain its structure, with high winds and heavy rain, the weather agency said One person had died amid heavy winds and rain brought by Typhoon Krathon, while 70 were injured and two people were unaccounted for, the Central Emergency Operation Center said yesterday, while work and classes have been canceled nationwide today for the second day. The Hualien County Fire Department said that a man in his 70s had fallen to his death at about 11am on Tuesday while trimming a tree at his home in Shoufeng Township (壽豐). Meanwhile, the Yunlin County Fire Department received a report of a person falling into the sea at about 1pm on Tuesday, but had to suspend search-and-rescue
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