Shares in Taiwan closed higher Friday, extending the momentum from the previous sessions, as the bellwether electronics sector continued an uptrend amid optimism toward its shipments during the current peak season in the global high-tech market, dealers said.
Taiwan Semiconductor Manufacturing Co. (TSMC, ???), the most weighted stock on the local market, lead the gains in electronic sector and pushed the broader market higher throughout the session on the back of sound fundamentals, dealers said.
The weighted index on the Taiwan Stock Exchange (TWSE) ended up 49.36 points, or 0.53 percent, at the day's high of 9,284.62, off an early low of 9,228.66. Turnover totaled NT$64.48 billion (US$2.05 billion) during the session.
The market opened up 4.99 points but soon fell into negative territory as investors pocked the gains they had built earlier in the week, despite a stronger Wall Street, dealers said.
On Wall Street, the Dow Jones Industrial Average closed up 0.54 percent and the tech-heavy NASDAQ index ended up 0.84 percent Thursday after the Federal Reserve decided not to raise interest rates, dealers said.
In the Taiwan market, buying reemerged around 9:30 a.m. Friday, lifting the electronics sector, and became more evident late in the trading session, which boosted the weighted index to the day's high at the close, dealers said.
"The late buying increased turnover by about NT$6 billion, largely focusing on high tech stocks, in particular TSMC," Hua Nan Securities analyst Kevin Su said. "Judging from the gains, I think that foreign institutional investors stood on the buy side again since they still held a large chunk of long position contracts in the futures market."
According to the TWSE, foreign institutional investors bought a net NT$4.77 billion worth of shares on the main board Friday. Su said foreign institutional investors held about 74,000 more long position contracts than short position ones in the local futures market as of Thursday.
The bellwether electronics sector closed up 0.66 percent after TSMC, the world's largest contract chip maker, rose 1.08 percent to end at a record high of NT$187.50.
The chip maker, which supplies the A10 processor for the latest iPhones, also saw its market capitalization rise to a record NT$4.86 trillion on Friday.
Among the other "Apple concept stocks," smartphone camera lens supplier Largan Precision Co. (???) gained 1.46 percent to close at NT$3,830.00, and metal casing producer Catcher Technology Co. (??) added 2.10 percent to end at NT$267.00.
"The interest in these high-tech stocks reflected an upbeat mood over Taiwan's exports," Su said, referring to an 8.3 percent year-on-year growth in the country's export orders in August after 16 months of decline.
The financial sector, which also benefited from the late session buying, ended up 0.42 percent. E. Sun Financial Holding Co. (???) rose 1.40 percent to end at NT$18.05, and Mega Financial Holding Co. (???) ended up 0.90 percent at NT$22.50.
This week, the local main board gained 382.32 points, ending 4.29 percent higher.
"After the gains this week, the main board is technically healthier," Su said. "But with the index closing above the 9,200-point mark, there is limited room for further gains.
Source: Focus Taiwan News Channel