Taipei: Shares in Taiwan closed higher on Tuesday, driven by optimism following rallies on U.S. markets. The gains came amid hopes that the Federal Reserve might cut interest rates after the release of weaker-than-expected retail sales data in February.
According to Focus Taiwan, the Taiex, Taiwan Stock Exchange's benchmark weighted index, rose 153.04 points, or 0.69 percent, closing at 22,271.67. The index fluctuated between 22,186.42 and 22,327.10 throughout the day, with a total turnover amounting to NT$273.99 billion (US$8.30 billion). The movement was attributed to investors interpreting the lower-than-expected U.S. retail sales growth of 0.2 percent, compared to a forecast of 0.6 percent, as an indicator of a potential rate cut by the Fed.
Mega International Investment Services analyst Alex Huang noted that the anticipation of a Fed rate cut encouraged investors to acquire large-cap stocks. The electronics index saw a rise of 0.75 percent, with Taiwan Semiconductor Manufacturing Co. (TSMC), a key component, ending 0.62 percent higher at NT$971.00. Other tech firms contributed to the Taiex's upward trend, with MediaTek Inc. increasing by 3.51 percent to NT$1,475.00 and ASE Technology Holding Co. climbing 1.90 percent to NT$160.50.
Interest in artificial intelligence stocks was evident as investors anticipated favorable developments from Nvidia Corp.'s ongoing annual GPU technology conference. Consequently, AI server maker Quanta Computer Inc. rose 1.76 percent to NT$259.50, while Inventec Corp. increased by 2.04 percent to NT$47.60. Conversely, Hon Hai Precision Industry Co., a significant player in the tech industry, saw a decline of 0.30 percent to NT$167.50.
Outside the technology sector, the textile industry saw gains with Far Eastern New Century Corp. and Eclat Textile Co. rising by 2.54 percent and 2.11 percent, respectively. Additionally, in the automotive sector, China Motor Corp. and Yulon Motor Co. posted gains of 1.01 percent and 1.09 percent, respectively.
The financial sector also experienced a boost, with Cathay Financial Holding Co., Mega Financial Holding Co., and Fubon Financial Holding Co. posting modest increases. However, despite the day's gains, the Taiex remained within a consolidation phase due to ongoing uncertainties from tariff threats by the Trump administration, as noted by Huang. He emphasized that profit-taking opportunities might arise whenever the index rebounds.
Despite the positive performance, foreign institutional investors sold a net NT$4.61 billion in shares on the market Tuesday.