Local shares on Friday moved higher to overcome stiff technical resistance ahead of 10,400 points as the bellwether electronics sector continued to steam ahead, led by contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), dealers said.
The old economy sector also attracted buying as bargain hunters rushed to pick up stocks in the sector, which has lagged behind the high-tech sector, as well as the broader market, for some time, dealers added.
The TAIEX on Friday closed up 90.59 points, or 0.88 percent, at the day’s high of 10,439.24, after rebounding from a low of 10,370, on turnover of NT$152.996 billion (US$4.95 billion).
That was a 1.9 percent gain from a close of 10,241.75 on March 8.
The market opened up 0.25 percent as investors shrugged off a sluggish Wall Street, where the Dow Jones Industrial Average closed up 0.03 percent and the tech heavy NASDAQ ended down 0.16 percent overnight, dealers said.
Buying accelerated on the local main board as TSMC, the most heavily weighted local stock, moved higher to lead the semiconductor sector and the entire electronics sector to post gains, while old economy stocks in the petrochemical and textile sectors were favored by bargain hunters, pushing the TAIEX up to the day’s high at the end of the session, they said.
“TSMC’s gains show that foreign institutional investors tend to push up the index on the spot market in a bid to profit in the futures market, as they still own a large chunk of long position futures contracts,” Mega International Investment Services Corp (兆豐國際投信) analyst Alex Huang (黃國偉) said.
Foreign institutional investors own a net total of about 60,000 long position futures contracts, a high level indicating that they are upbeat about the spot market, Huang said.
TSMC rose 1.92 percent to close at NT$239, with