Taiwan's key stock index rose for a fifth day on expectations the central bank will follow the US' lead and reduce interest rates as early as today. Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) led gains.
The TAIEX rose 75.23, or 1.8 percent, to 4,158.15, after rising as much as 2.3 percent. Within the index, 329 stocks rose and 142 fell. TSMC accounted for a fifth of the index's gains.
The Central Bank of China trimmed its rediscount rate, charged to commercial lenders for 10 day loans, to a record 2.25 percent from 2.5 percent yesterday.
A rate cut would be "more geared to shore up sentiment and stock market valuations as banks show little inclination to lend money," said Michael Spencer, chief economist for Asia at Deutsche Bank AG.
Taiwan's Cabinet abolished a US$50 million limit on investments in China, further boosting investor sentiment on hopes tense relations with China may be reduced.
The total value of trade was NT$75.23 billion (US$2.2 billion), 16 percent higher than the average daily turnover this year of NT$66.9 billion. The index is the sixth best performing in the world in the last month, up 16 percent in US-dollar terms.
TSMC rose NT$1.50, or 2.3 percent, to NT$67, bringing its gain since its six-month low on Oct. 3 to 52 percent. The biggest made-to-order chipmaker said its board of directors approved the sale of NT$15 billion (US$435 million) of bonds to domestic investors. Its rival United Microelectronics Corp (UMC,
Banks gained on hopes another interest rate cut by the nation's central bank will help companies meet their debt obligations and lessen their non-performing loans, which rose to NT$1.66 trillion (US$48 billion), or 7.8 percent of outstanding credits, in September, the central bank said.
First Commercial Bank (
Changhwa Commercial Bank (
Transport stocks advanced on expectations direct transport links between China and Taiwan may result once both join the WTO. China Airlines Co (華航), the biggest airline in the country, rose NT$0.15, or 1.3 percent, to NT$11.75. Eva Airways Corp (長榮航空), Taiwan's second-biggest airline, rose NT$0.15, or 2.3 percent, to NT$6.65.
Evergreen Marine Corp (
Hon Hai Precision Industry Co (
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