Shares in Taiwan moved higher Monday behind interest in the electronics sector that was sparked by a rally in tech stocks in the United States at the end of last week, dealers said.
Integrated circuit designer MediaTek Inc. attracted considerable attention and ended above the NT$1,000.00 level for the first time in more than six months, helping the semiconductor industry trend higher, they said.
The Taiex, the Taiwan Stock Exchange's benchmark index, ended up 116.34 points, or 0.66 percent, at 17,634.47, after moving between 17,560.52 and 17,683.19. Turnover totaled NT$376.46 billion (US$13.55 billion).
The Taiex opened up 0.24 percent and quickly rose by more than 100 points as investors responded to a 1 percent rise in the tech-heavy Nasdaq index and a 0.80 percent rise in the Philadelphia Semiconductor Index on Friday, dealers said.
Sustained interest in the electronics sector kept the Taiex firmly in positive territory throughout the rest of the session, but old economy stocks appeared mixed.
The electronics sector closed up 0.95 percent and accounted for almost 70 percent of the total turnover on the market, while the semiconductor sub-index rose 1.15 percent.
"Large tech stocks, especially semiconductors, drove the broader market higher today," More Rich Securities Consulting analyst Chang Chih-cheng said.
"Buying rotated to MediaTek, while contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC) had relatively smaller gains."
MediaTek, second to TSMC in terms of market capitalization, soared 4.27 percent to close at NT$1,025.00, while TSMC added 0.66 percent to end at NT$608.00.
"MediaTek shares got a boost from the rising popularity of its 5G chips in the global smartphone market, and the upcoming holiday shopping season in the U.S. and European markets is expected to push up its sales" Chang said.
A U.S. brokerage's billing of MediaTek as its top stock pick also helping push the company's shares above the 1,000.00 mark for the first time since May 7, when it closed at NT$1,060.00.
Among other semiconductor stocks, United Microelectronics Corp., a smaller contract chipmaker in Taiwan, rose 1.28 percent to close at NT$63.40.
Novatek Microelectronics Corp., which supplies drive ICs for flat panels, gained 4.10 percent to end at NT$470.00 after the company predicted over the weekend that it will post a record high of more than US$5 billion in sales in 2021.
Also in the electronics sector, Yageo Corp., the world's third largest multilayer ceramic capacitors (MLCC) supplier, rose 2.91 percent to close at NT$442.00, and printed circuit board maker Compeq Manufacturing Co. closed 2.06 percent higher at NT$42.10.
Bucking the upturn, iPhone assembler Hon Hai Precision Industry Co. slid 0.92 percent to close at NT$108.00, and Largan Precision Co., a supplier of smartphone camera lenses to Apple Inc., fell 0.24 percent to end at NT$2,105.00.
"The tech sector dominated trading today, and many old economy stocks were in the doldrums," Chang said.
Among old economy stocks, textile maker Far Eastern New Century Corp. lost 0.50 percent to close at NT$30.00, Formosa Plastics Corp. fell 0.47 percent to end at NT$107.00, and Taiwan Cement Corp. dropped 0.21 percent to close at NT$48.60.
Food brand Uni-President Enterprises Corp., however, gained 1.04 percent to end at NT$68.00.
In the transportation sector, airline stocks were spotlighted on news that some major economies were easing their border controls. China Airlines surged 3.33 percent to close at NT$26.40, and EVA Airways closed 1.33 percent higher at NT$26.75.
But the maritime shipping industry largely came under pressure.
Yang Ming Marine Transport Corp. closed 1.41 percent lower at NT$105.00, and Wan Hai Lines Ltd. also slid 1.26 percent to end at NT$157.00, while Evergreen Marine Corp. rose 0.45 percent to close at NT$112.00.
In the financial sector, which ended up 0.91 percent, Cathay Financial Holding Co. rose 1.36 percent to close at NT$59.70, and Fubon Financial Holding Co. added 0.95 percent to end at NT$74.50.
"Judging from the performance of the U.S. markets, I think investors have left inflation concerns behind for the moment, paving the path for a higher Taiex," Chang said.
"In addition, the strong liquidity in Taiwan's market is expected to continue, and the Taiex could soon challenge an intraday high of 17,709 reached on Sept. 29."
According to the TWSE, foreign institutional investors bought a net NT$5.43 billion in shares Monday.
Source: Focus Taiwan News Channel