Taiwan shares end at new high amid interest in tech stocks

Taipei, June 18 (CNA) Shares in Taiwan smashed record closing levels Thursday with large tech stocks in focus as investors continued to focus on strong AI development, shrugging off the hawkish tone struck by the U.S. Federal Reserve after wrapping up a policymaking meeting overnight, dealers said.

The Taiex, the Taiwan Stock Exchange's benchmark index, ended up 587.81 points, or 1.28 percent, at 46,465.20 after moving between 45,872.26 and 46,565.70. Turnover totaled NT$1.54 trillion (US$48.51 billion).

"Tech stocks in Taiwan followed their counterparts in the United States to move higher, even though the Fed implied a rate hike is possible by the end of this year to take on inflation," Cathay Futures Consultant analyst Tsai Ming-han (蔡明翰) said.

While three other major indexes in the U.S., including the Dow Jones Industrial Average, moved lower overnight, the Philadelphia Semiconductor Index rose 1.38 percent.

"Sound fundamentals during the current AI boom continued to push up the bellwether electronics sector and the Taiex," Tsai said.

With its American depositary receipts up 1.48 percent Wednesday, contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC), which accounts for over 40 percent of total market value, rose 1.05 percent to close at NT$2,410.00. The stock's gains contributed about 200 points to the Taiex's rise.

"I expect buying in TSMC will continue to push up the Taiex further," Tsai added.

Among other chip stocks, United Microelectronics Corp., a smaller contract chipmaker, gained 3.93 percent to end at NT$145.50 and IC packaging and testing service firm ASE Technology Holding Co. added 3.03 percent to close at NT$613.00. Bucking the upturn, smartphone IC designer MediaTek Inc. ended down 1.57 percent at NT$4,390.00.

Also in the tech sector, shares in Yageo Corp., the world's third largest multi-layer ceramic capacitor (MLCC) maker, soared 10 percent, the maximum daily increase, to close at NT$1,080.00. However, iPhone assembler and AI server maker Hon Hai Precision Industry Co. ended down 1.29 percent at NT$268.50.

"With the Taiex still awash in liquidity, rotational buying remained active and the financial sector remained hopeful of higher dividend payouts," Tsai noted.

In the financial sector, which rose 1.36 percent, Fubon Financial Holding Co. gained 1.85 percent to close at NT$138.00, and Cathay Financial Holding Co. ended up 1.76 percent at NT$115.50.

Select old economy stocks played catch-up with their tech counterparts, Tsai said.

Nan Ya Plastics Corp. surged 10 percent to close at NT$139.00 on its production of glass cloth used in AI gadgets, and its affiliate Formosa Plastics Corp. rose 7.82 percent to end at NT$51.70.

On hopes of massive government investment on electricity grid network upgrades, Fortune Electric Co. rose 3.74 percent to close at NT$833.00, and Shihlin Electric & Engineering Corp. added 2.11 percent at NT$241.50.

According to the Taiwan Stock Exchange, foreign institutional investors bought a net NT$21.13 billion of shares on the main board Thursday.