Taipei--Market capitalization of the local main board rose almost 3 percent this week after the Taiwan Stock Exchange Capitalization Weighted Stock Index (TAIEX) breached the 9,900 point mark, according to the Taiwan Stock Exchange (TWSE).
The TWSE data showed that market cap of the main board rose 2.98 percent from a week earlier to NT$29.33 trillion (US$958 billion) in the week ending on Friday with the weighted index ending at 9,908.69 points, the highest closing level since April 28, 2016, when the index finished at 9,956.83.
In the week, the weighted index rose 280.80 points, or 2.92 percent amid improving market sentiment with investors rushing to pick up market heavyweights such as contract chip maker Taiwan Semiconductor Manufacturing Co. (TSMC, ???) and smartphone camera lens supplier Largan Precision Co. (???), after the U.S. Federal Reserve said that it will implement an interest rate hike cycle in a "gradual" manner.
In the week, TSMC, the most heavily weighted stock in the local market gained 4.36 percent to close at NT$191.50 while Largan, the most expensive stock in Taiwan, rose 5.66 percent to end at NT$4,760.00.
After wrapping up a two-day policymaking meeting on Wednesday, the Fed hinted that it will raise its key interest rates three times in 2017, one fewer than the market had anticipated.
Amid eased concerns over the Fed's rate hike cycle, foreign investors moved more of their funds into the region, including Taiwan, market analysts said. On the back of further fund inflows, foreign institutional investors scrambled to buy into local equities and posted a huge net buy in the past week.
The TWSE data showed that foreign institutional investors bought a net NT$40.17 billion worth of shares on the main board in the week. On Friday alone, a net buy posted by foreign institutional investors stood at NT$13.5 billion, the highest level since July 21, 2016, when foreign investors served as net buyers of NT$16.03 billion.
In the week, the Formosa Stock Index, which is comprised of stocks listed on the main board and the over-the-counter market, rose 321.22 points, or 2.90 percent, while the FTSE TWSE Taiwan 50 Index, which consists of the 50 largest companies in Taiwan in terms of market cap, gained 232.21 points, or 3.24 percent, the TWSE said.
On the main board, turnover of the semiconductor sector, led by the TSMC, totaled NT$70.91 billion, accounting for 16.8 percent of the total, the highest among the major sectors in the market.
The optoelectronics sector, led by Largan, came in second as turnover hit NT$65.94 billion, making up 15.62 percent of the total, ahead of the electronics component sector, turnover of which reached NT$43.31 billion, representing 10.26 percent.
Source: Focus Taiwan News Channel