Taiwan stocks rose 0.81 percent to finish at a one-week high on Tuesday as a record close for the Dow fanned investor hopes of stronger demand for US firms' suppliers like Taiwan Semiconductor Manufacturing Co.
The main TAIEX share index ended at 7,097.42, paced by a 0.75 percent gain in the electronics sub-index. Turnover was slightly higher at T$88.1 billion (US $2.65 billion), up from T$71 billion in the previous session.
"The Dow's stellar performance helped lift equities markets world-wide," said Tu Jin-lung, chairman of Gand Cathay Investment Services. "For Taiwan, chances are good for the benchmark index to jump above 7,476 points, the highest this year."
Among the most actively traded issues, TSMC, the world's No 1 contract chip maker, jumped 2.94 percent and its smaller rival, United Microelectronics Corp, rose 0.82 percent.
Their gains came after the US Dow Jones Industrial Average rallied 0.95 percent to finish at 12,116.91 and the tech-heavy Nasdaq Composite Index rose 0.57 percent.
BenQ Corp, the world's No 6 mobile phone vendor, ended up 0.58 percent. BenQ may post a fourth straight quarterly loss later in the day as it suffered from losses in its Germany mobile phone unit.
The banking sub-index climbed 1.17 percent after local media reported Taiwan's banking regulator would not object to the island's insurance companies investing in Chinese banks. Cathay Financial Holding, Taiwan's top financial holding company, jumped 0.77 percent. Cathay's flagship unit Cathay Life Insurance is Taiwan's No 1 insurer.
Shin Kong Financial, whose main unit is also a life insurer, rose 1.69 percent. Innolux Display, which makes LCDs and assembles LCD monitors, soared more than 40 percent by midday before ending up 33.7 percent on its first day of trading.
Taiwan's top electronics gear maker, Hon Hai Precision Industry, and some of its affiliates own about a quarter stake in Innolux. Hon Hai shares closed unchanged. Innolux became profitable by the end of September and should show a clear profit in the fourth quarter, its president told the Commercial Daily.
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