
Taipei, May 13 (CNA) Shares in Taiwan moved higher by 200 points Tuesday as the United States and China agreed to cut tariffs substantially, though part of the initial gains were eroded on profit taking, dealers said.
The Taiex, the weighted index on the Taiwan Stock Exchange (TWSE), ended up 200.60 points, or 0.95 percent, at the day's low of 21,330.14, off a high of 21,626.28. Turnover totaled NT$390.507 billion (US$12.84 billion).
The market opened up 344 points and rose to the day's high in the early morning session, rising almost 500 points on the back of a rally on U.S. markets.
The Dow Jones Industrial Average soar 1,160 points overnight after the U.S. and China agreed to step back from their tit-for-tat escalation of "reciprocal" tariffs for an initial period of 90 days, dealers said.
Under the agreement, Washington has cut tariffs on China made goods from 145 percent to 30 percent, while Beijing has reduced tariffs on U.S.-made goods from 125 percent to 10 percent.
However, the Taiex faced stiff technical resistance when it breached the 21,356 points, the 60-day moving average, and saw gains moderate until the end of the session, dealers said.
"The U.S.-China significant tariff cut was encouraging so U.S. markets jumped overnight and the Taipei market just followed today," Mega International Investment Services Corp. analyst Alex Huang said.
"But, the local main board posted (1.03 percent) gains yesterday on high hopes about a tariff cut ahead of the U.S.-China announcement, so with the index breaching the 60-day moving average today, some investors simply rushed to lock in their profits," Huang said.
The bellwether electronics sector led the upturn throughout the Tuesday session, rising 1.17 percent after shares in contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC) rose 1.25 percent to close at NT$969.00, Huang added.
Memory chip Nanya Technology Corp. surged 10 percent, the maximum daily increase, to end at NT$40.90 on market speculation over product price hikes.
In addition, smartphone IC designer MediaTek Inc. rose 3.04 percent to close at NT$1,355.00, and IC packaging and testing services provider ASE Technology Holding Co. added 2.11 percent to end at NT$145.00.
"The upcoming Computex Taipei (May 20-23) prompted investors to pick up artificial intelligence related tech stocks on hopes of positive leads from the annual tech exhibition," Huang said.
IPhone assembler and AI server maker Hon Hai Precision Industry Co. rose 3.27 percent to close at NT$158.00 and Quanta Computer Inc. ended up 1.35 percent at NT$262.00.
While many old economy stocks moved in consolidation, shipping stocks outperformed on expectations that eased trade frictions between Washington and Beijing will boost cargo volume, Huang said.
Evergreen Marine Corp., the largest container cargo shipper in Taiwan, rose 6.90 percent to close at NT$232.50, and rivals Yang Ming Marine Transport Corp. and Wan Hai Lines Ltd. gained 7.59 percent and 4.66 percent, respectively, to end at NT$78.00 and NT$92.00.
"Investors should keep a close eye on U.S. inflation data due later today which could move the markets," Huang noted. "Hon Hai and Quanta are scheduled to hold investor conferences tomorrow that are very likely to give guidance about the AI server business."
According to the TWSE, foreign institutional investors bought a net NT$15.16 billion worth of shares on the main board Tuesday.
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