Taiwan shares end above 44,000 points as tech stocks rebound on U.S. rally

Taipei, May 27 (CNA) Shares in Taiwan closed above the 44,000-point mark for the first time Wednesday after the bellwether electronics sector rebounded following a U.S. rally overnight amid continued enthusiasm over AI development, dealers said.

The Taiex, the Taiwan Stock Exchange's benchmark index, ended up 731.43 points, or 1.68 percent, at 44,256.80 after moving between 43,842.26 and 44,818.25. Turnover totaled NT$1.557 trillion (US$49.53 billion).

"Today's large turnover demonstrated the willingness to chase prices was high, with buying in large-cap electronics stocks sparked by the strong showing in the United States overnight," Mega International Investment Services Corp. analyst Alex Huang said, citing a 1.19 percent increase on the tech-heavy Nasdaq index.

"Many investors have high hopes that the upcoming Computex Taipei will generate positive leads on AI development so they rushed to build up their holdings now," Huang said.

The electronics index rose 1.85 percent to drive the Taiex higher after contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC), which accounts for over 40 percent of total market value, gained 1.32 percent to end at NT$2,300.00, contributing about 240 points to the Taiex's rise.

"TSMC still traded at a relatively low price-to-earnings multiple compared with other AI-related stocks," Huang said. "I expect the stock has great potential to go even higher."

Among other semiconductor stocks, smartphone IC designer MediaTek Inc. rose 8.79 percent to end at NT$4,640.00 and IC packaging and testing services provider ASE Technology Holding Co. gained 5.07 percent to close at NT$642.00.

United Microelectronics Corp. soared 10 percent, the maximum daily increase, to end at NT$143.50 as the smaller contract chipmaker said its cooperation with Intel Corp. on the 12-nanometer process remains on schedule.

Also in the tech sector, shares in power management solution supplier Delta Electronics Inc. rose 7.23 percent to close at NT$2,520.00 and iPhone assembler and AI server maker Hon Hai Precision Industry Co. ended up 1.93 percent at NT$264.00.

"The financial sector served as another driver to the Taiex's gains as many financial firms investing in the stock market have posted handsome profits," Huang added.

Fubon Financial Holding Co. rose 6.28 percent to close at NT$110.00, and Cathay Financial Holding Co. rose 2.77 percent to end at NT$85.40.

However, old economy stocks largely lagged behind the Taiex with textile maker Far Eastern New Century Co. plunging 10 percent, the maximum daily decline, to close at NT$23.45, and Eclat Textile Co. falling 1.05 percent to end at NT$331.00.

Food brand Uni-President Enterprises Corp. lost 0.85 percent to close at NT$70.20 and Wei Chuan Foods Corp. ended down 1.63 percent at NT$12.10.

"Local investors stood behind the recent strong Taiex upturn," Huang said. "Sitting on massive excess savings, local investors could park more funds in the bourse to boost liquidity further, paving the path to more returns."

According to the Taiwan Stock Exchange, foreign institutional investors bought a net NT$38.13 billion of shares on the Taiex Wednesday.