Taipei--Taiwanese shares hit a 21-month high, closing just short of 9,800 points on Wednesday in a liquidity-driven session with market sentiment boosted by a stronger New Taiwan dollar after major U.S. stock indexes hit record highs overnight, dealers said.
Buying in the electronics, steel and shipping sectors drove Wednesday's gains, led by contract chip maker Taiwan Semiconductor Manufacturing Co. (TSMC, ???) and smartphone vendor HTC Corp. (???).
The weighted index on the Taiwan Stock Exchange closed up 80.98 points, or 0.83 percent, at 9,799.76, after moving between 9,813.98 and 9,723.04 during the trading session, on turnover of NT$115.36 billion (US$3.75 billion).
The market opened up 5.35 points and quickly passed 9,800 points in reaction to the record highs recorded by the Nasdaq Composite and S&P 500 indexes on Tuesday and an uptick in the local currency.
U.S. stocks notched a fourth straight record close on Tuesday with a rally led by bank stocks after Federal Reserve Chairwoman Janet Yellen signaled the central bank would gradually raise interest rates sooner rather than later.
However, as the Taiex climbed above 9,800 points, selling set in and the momentum proved unsustainable.
Shares in TSMC, the most heavily weighted stock on the local market, gained 0.80 percent to end at NT$189 after the company's board of directors approved on Tuesday a 21-year high cash dividend of NT$7 per share after last year's record high net profit of NT$334.25 billion.
HTC closed up 3.54 percent at NT$78.90 on Wednesday after announcing the previous day that its net loss for the first quarter of the year is expected to shrink, while shares in flat panel maker AU Optronics Corp. (AUO, ??), gained 1.69 percent to end at NT$12 after the company on Tuesday posted a net profit for the fourth consecutive year in 2016.
The local bourse has gained 3.72 percent since Feb. 2, the first trading session in the Year of the Rooster after a six-day Lunar New Year holiday, dealers said, suggesting that investors should focus on large-cap stocks and raw material shares and watch to see whether Yellen's message impacts capital inflows into Taiwan's stock market in the coming month.
Foreign institutional investors bought a net NT$13.34 billion worth of shares on the main board on Wednesday, according to Taiwan Stock Exchange Corp.
Source: Focus Taiwan News Channel