Taipei: Shares in Taiwan closed significantly higher, surpassing previous records, as the market experienced a surge of over 1,000 points on Friday. This rise was largely attributed to strong buying interest in the electronics sector, spurred by ongoing enthusiasm for artificial intelligence and improved geopolitical sentiment following reports of a ceasefire extension agreement between the United States and Iran.
According to Focus Taiwan, the Taiex, Taiwan Stock Exchange's benchmark index, gained 1,096.50 points, or 2.51 percent, closing at 44,732.94. This was after fluctuating between 43,815.48 and 44,933.95 throughout the day. Market turnover reached a new high of NT$1.82 trillion (US$57.29 billion).
Cathay Futures Consultant analyst Tsai Ming-han highlighted that the substantial turnover was fueled by last-minute buying in anticipation of MSCI's upgrade of Taiwan's weighting in three major indexes, effective after the market closed on Friday. Tsai noted that reduced concerns over geopolitical issues in the Middle East and optimism towards AI played a significant role in this buying wave.
The robust performance of the local electronics sector mirrored the record-breaking trends seen in the tech-heavy Nasdaq index. Notably, Taiwan Semiconductor Manufacturing Co. (TSMC) rose 2.61 percent to close at NT$2,355.00, contributing approximately 480 points to the Taiex's rise. This pushed the electronics index up by 2.62 percent.
In the semiconductor realm, Nanya Technology Corp. saw a 7.10 percent increase, ending at NT$347.00, while Alchip Technologies Ltd. added 2.67 percent to close at NT$4,415.00.
The tech sector also witnessed significant gains from iPhone assembler and AI server provider Hon Hai Precision Industry Co., which soared by the maximum daily increase of 10 percent to NT$289.00. This surge followed the company's goal to enhance its annual earnings per share above NT$20 within two years amid the AI boom.
Quanta Computer Inc., another AI server supplier, and Delta Electronics Inc., a power management solution provider, also experienced notable increases, with Quanta surging 10 percent to NT$339.00 and Delta rising 2.30 percent to NT$244.50.
Tsai noted that with ample liquidity in the market, investors also directed funds toward select old economy stocks with relatively lower valuations. Formosa Plastics Corp. and Nan Ya Plastics Corp. recorded gains, rising 5.33 percent and 8.40 percent, respectively.
Other sectors saw positive movement as well, with Asia Cement Corp. rising 4.94 percent to NT$34.00 and Lucky Cement Co. gaining 7.23 percent to NT$207.90. In the airline industry, China Airlines rose 2.69 percent to NT$19.10, and EVA Airways increased by 2.12 percent to NT$36.05.
The financial sector witnessed mixed results; CTBC Financial Holding Co. rose 2.02 percent to close at NT$60.50, Cathay Financial Holding Co. increased by 1.06 percent to NT$85.70, while Fubon Financial Holding Co. remained unchanged at NT$110.00.
Tsai cautioned that despite the recent rally, technical resistance is expected as the index approaches the 45,000-point mark.
According to the Taiwan Stock Exchange, foreign institutional investors purchased a net NT$80.36 billion of shares on the main board on Friday.