Taiex ends up after briefly topping 40,000 points

Taipei, April 27 (CNA) Shares in Taiwan closed nearly 2 percent higher on Monday, led by contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC), but the market retreated after topping the 40,000-point mark for the first time in history, dealers said.

The Taiex, the Taiwan Stock Exchange's benchmark index, ended up 684.23 points, or 1.76 percent, at 39,616.63 after hitting a high of 40,194.92. Turnover totaled NT$1.18 trillion (US$37.38 billion).

The market went above 40,000 points just minutes after it opened, boosted by a tech rally in the United States on Friday, when TSMC's American depositary receipts rose 5.17 percent, dealers said.

"TSMC was the major driver of the Taiex's gains today as the gains shown by semiconductor stocks on the U.S. market boosted expectations about TSMC's valuation," Moore Securities Investment Consulting analyst Adam Lin said.

TSMC closed up 3.66 percent at NT$2,265.00, off a high of NT$2,280.00.

The chipmaker's stock also benefited from a policy that took effect Friday allowing ETFs to increase their investment in any single stock accounting for more than 10 percent of total market value to 25 percent of the ETFs net assets from the previous 10 percent.

TSMC accounts for over 40 percent of the market's total value.

With TSMC attracting most of the buying, Lin said some other semiconductor stocks appeared lackluster.

Smartphone IC designer MediaTek Inc. closed unchanged at NT$2,435.00, and IC packaging and testing service firm ASE Technology Holding Co. fell 0.10 percent to end at NT$495.50.

Also in the tech sector, power management solution provider Delta Electronics Inc. shed 2.65 percent to close at NT$2,020.00, but AI server and iPhone assembler Hon Hai Precision Industry Co., a market laggard, rose 2.93 percent to end at NT$228.00.

Funds also rotated out of the non-tech sector, Lin said.

China Steel Corp., Taiwan's biggest steel maker, dropped 1.32 percent to close at NT$18.75 and Chung Hung Steel Corp. shed 1.17 percent to end at NT$16.95.

Hotai Motor Co. dropped 1.32 percent to close at NT$489.00, while China Motor Corp. rose 0.38 percent to end at NT$53.40.

In the financial sector, Fubon Financial Holding Co. added 0.11 percent to close at NT$87.90, but Cathay Financial Holding Co. ended down 0.53 percent at NT$74.50.

"I am not worried about the Taiex's failure to sustain its gains above 40,000 points today. I expect TSMC will continue to move higher on its sound fundamentals and U.S. tech gains, helping the index challenge that level again," Lin said.

According to the Taiwan Stock Exchange, foreign institutional investors sold a net NT$51.20 billion in shares Monday.