Taiwan stocks rise on China moves, Wall Street rally

Taiwan stocks rose on Monday as shares of companies that sell to China gained on expectations of more stable economic policies after a smooth leadership transition, while a rally on Wall Street also boost sentiment.
The main TAIEX share index ended 0.79 percent higher at 5,864.54 points, re-couping some losses after a slow retreat from a 3-month high hit early last week.
Analysts said the handover of the military portfolio from Jiang Zemin to Hu Jintao on Sunday would lend stability to China's long-term economic development, helping lift the shares of industrial companies that export to the mainland market.
"The combination of a US rally and the prospects of more stability in China policies helped ease investor worries about the future," said Michael On, the director of Beyond Asset Management, which has about US $60 million under management. China Steel Corp, Taiwan's top steel maker, rose 1.8 percent to T$34.0, helping pull the steel subindex up 3.09 percent.
The transportation index rose 4.66 percent and the cement index added 4.71 percent, reflecting hopes of more stable trade ties with China.
Higher oil prices lifted China Petrochemical Development Corp by the daily 7-percent maximum to T$6.80, and the shares were among the most actively traded.
Overall turnover was moderate at T$83.2 billion, but rose from T$74.8 billion on Friday.
However, recent accounting problems at three small electronics companies are casting a pall over the tech sector as investors worried other irregularities will be uncovered by a cyclical industry downturn.
Taiwan software firm Summit Computer Technology Co admitted last week that it inflated revenues over 4 years, which followed irregularities at Procomp Informatics Ltd and Infodisc Technology Co Ltd.
The over-the-counter TAISDAQ, which is home to many small electronic companies, fell 1.38 percent.
The weakness came despite a 0.39 percent rise on the Dow Jones industrial average and a 0.32 percent gain on the tech-laced Nasdaq index on Friday.
The two indices are key barometers as many Taiwan electronics companies supply leading US multinationals.
A 0.95 percent fall in shares of United Microelectronics, the world's second largest contract maker of microchips, helped pull the mainboard's heavily weighted tech subindex down 0.49 percent. The October TAIEX futures added 0.74 percent to close at 5,840.