Taipei: 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).
According to Focus Taiwan, the large turnover highlighted the eagerness of investors to chase prices, with large-cap electronics stocks gaining momentum due to the strong performance in the United States overnight, where the tech-heavy Nasdaq index increased by 1.19 percent. Analyst Alex Huang from Mega International Investment Services Corp. noted that investors are hopeful that the upcoming Computex Taipei will generate positive leads on AI development, prompting them to build up their holdings.
The electronics index rose 1.85 percent, propelling the Taiex higher, as contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC), which accounts for over 40 percent of the total market value, gained 1.32 percent to end at NT$2,300.00. This contributed approximately 240 points to the Taiex's rise. Huang mentioned that TSMC still trades at a relatively low price-to-earnings multiple compared to other AI-related stocks, predicting significant potential for further growth.
Other semiconductor stocks also performed well, with smartphone IC designer MediaTek Inc. rising 8.79 percent to NT$4,640.00, and IC packaging and testing services provider ASE Technology Holding Co. gaining 5.07 percent to close at NT$642.00. United Microelectronics Corp. saw a 10 percent increase to end at NT$143.50, following its announcement of continued cooperation with Intel Corp. on the 12-nanometer process.
In the tech sector, shares in power management solution supplier Delta Electronics Inc. rose 7.23 percent to NT$2,520.00, while iPhone assembler and AI server maker Hon Hai Precision Industry Co. increased by 1.93 percent to NT$264.00. The financial sector also contributed to the Taiex's gains, as many financial firms reported substantial profits from their stock market investments. Fubon Financial Holding Co. rose 6.28 percent to NT$110.00, and Cathay Financial Holding Co. increased by 2.77 percent to NT$85.40.
Despite these gains, old economy stocks lagged, with textile maker Far Eastern New Century Co. plunging 10 percent to NT$23.45 and Eclat Textile Co. falling by 1.05 percent to NT$331.00. Food brand Uni-President Enterprises Corp. lost 0.85 percent to NT$70.20, and Wei Chuan Foods Corp. ended down 1.63 percent at NT$12.10.
Huang added that local investors have been instrumental in the recent strong upturn of the Taiex. With substantial excess savings, local investors could inject more funds into the market, boosting liquidity and paving the way for additional returns. The Taiwan Stock Exchange reported that foreign institutional investors bought a net NT$38.13 billion of shares on the Taiex on Wednesday.