Taiwan stocks rose 0.61 percent to a 10-week closing high on Tuesday, with banks leading the way amid optimism of improving financial ties with China as Taiwan's parliament speaker gets set to visit the mainland this month.
The main TAIEX shares index climbed 47.92 points to 7,932.91, its highest since January 24, paced by a 1.19 percent gain on the banking and insurance sub-index. The heavily weighted electronics sub-index gained 0.55 percent.
Trading volume was T$118.6 billion (US $3.58 billion), slightly below T$120 billion the previous day. "Banking stocks are outperforming the main index due to optimism the parliament speaker's trip will produce an MOU (memorandum of understanding) to be signed by Taiwan and China," said Sheng Yen, who manages T$2 billion ($60 million) for Franklin Templeton First Taiwan Securities Investment Trust.
Cathay Financial, Taiwan's top financial holding firm, ended up 1.33 percent. State-run lender First Financial rose 0.43 percent and Taiwan Business Bank jumped 3.08 percent. First Financial is planning to acquire a 13.44 percent stake in smaller rival Taiwan Business Bank held by Mega Financial, as a first step to buying the bank, the Commercial Times reported, without citing sources. Fuhwa Financial, whose shareholders include top brokerage Yuanta Core Pacific and Taiwan's biggest opposition party the Kuomintang (KMT), rose 2.96 percent.
TSMC fell 0.29 percent, after ending 0.28 percent higher in overnight trading in the NYSE. Its board on Monday approved a plan that could boost the number of its outstanding American Depository Shares (ADSs) by up to 240 million ADSs. Struggling cell phone maker BenQ gained 1.93 percent after saying it sold 100 million shares in AU Optronics for T$4.54 billion, or a 5 percent discount to Monday's closing price. AU, the world's No 3 flat panel maker, rose 2.4 percent.
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