Taiwan stocks rose 1.9 percent on Wednesday in busy trade, hitting a fresh two-month closing high, as financials led the rally after Citigroup said it was profitable in the first two months of 2009. Semiconductor shares were also boosted after contract chipmaker TSMC raised first-quarter guidance, showing its current sales slump may have bottomed.
The main TAIEX share index closed 88.94 points higher at 4,759.96, slightly lower than a closing peak reached on January 7 and following a Wall Street rally that saw the major indexes rise more than 5 percent. Turnover shot up to a seven-month high, rising to T$111.9 billion ($3.3 billion) from Tuesdays T$86.5 billion. The banking and insurance sub-index jumped 4.22 percent, tracking a 16 percent surge in US financial shares, which were boosted by Citigroups upbeat comment.
Shares of Cathay Financial, the islands top listed financial holding firm, rose 5.54 percent. Shares of Chinatrust Financial, Taiwans largest credit card issuer, and Shin Kong Financial both rose by their 7 percent daily limit. Taiwan Semiconductor Manufacturing Co (TSMC), the worlds top contract chip maker, gained 3.29 percent after the firm sharply raised its first-quarter sales and margin forecasts due to rush orders from China.
Goldman Sachs and Deutsche Bank both raised their target prices on the chip maker after its guidance revision. Taiwans semiconductor sub-index rose 1.71 percent while the Philadelphia Stock Exchange index of semiconductors jumped by 8 percent overnight. Compal Electronics, the worlds No 2 contract laptop PC maker, jumped 4.82 percent after the company said it hoped to hit the high end or exceed its first quarter sales target.
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