Taiwan stocks closed up 1.25 percent on Tuesday, bouncing from a near 1-year low, as investors ventured back for bargains in the tech sector that had been hurt by concern over slower demand in the second half.
The main TAIEX seesawed in a tight range in early trade after the US Nasdaq fell to fresh 2004 lows on Monday, but buying kicked in later, helping the index up 66.9 points to 5,398.61 at the close.
The day's rebound recouped all the ground it lost on Monday and turnover expanded to T$58.29 billion from a 14-month low of T$37.19 billion in the previous session.
AU Optronics, the world's third-largest display maker and the market's most active issue, rose 2.76 percent to T$41.00 and rival Chi Mei Optoelectronics surged 6.65 percent to T$46.50.
Taiwan Semiconductor Manufacturing Co (TSMC) jumped 1.96 percent to T$41.70 and United Microelectronics Corp (UMC) was up 1.43 percent at T$21.30, ignoring a 1.29 percent fall on the Philadelphia semiconductor index.
The world's two largest contract chipmakers are expected to release strong second-quarter earnings results later this week but investors are awaiting their third-quarter guidance.
Another bright spot was Asustek Computer, Taiwan's largest maker of computer motherboards, whose share price rose 1.36 percent to end at T$74.50. A local newspaper said the firm aims to increase output by 50 percent by 2006.
The over-the-counter TAISDAQ index rose 0.64 percent to 112.50, and August TAIEX futures jumped 1.48 percent to close at 5,353.