The TAIEX yesterday rallied 0.79 percent, or 124.67 points, to 15,929.43, as cooling inflation in the US fed hope for interest rate hike pauses, overriding concerns over the National Stabilization Fund’s decision to exit the market, officials and analysts said.
The local bourse took cues from Wall Street, where investors breathed a sigh of relief after the US producers’ price index last month declined 0.5 percent from February and grew a weaker-than-expected 2.7 percent year-on-year, making further rate hikes unnecessary.
Deputy Minister of Finance Frank Juan (阮清華), who is executive secretary of the National Stabilization Fund, said there is no need to worry about the fund’s exit, which would be done gradually to limit its impact.
Photo: CNA
The government in July last year activated NT$500 billion (US$16.41 billion) of the fund to shore up local shares that took a hard hit amid drastic interest rate hikes by major central banks to combat steep inflation.
“The rally [yesterday] confirmed the health of local shares and investors should have confidence,” Juan told reporters on the sidelines of a public function.
The National Stabilization Fund on Thursday said it would end its longest streak of intervention, during which the TAIEX gained 13.29 percent from 13,950 to 15,804.
The National Stabilization Fund was mostly inactive last quarter, Juan said.
It had spent NT$54.5 billion as of the end of last month to shore up local shares, generating more than NT$8 billion in unrealized gains, or a return of 13.01 percent, data showed.
“The fund has not spent extra money since the end of last year, indicating that the market has recovered on its own and the fund has served its purpose,” Juan said.
Turnover yesterday totaled NT$249.613 billion after foreign institutional players increased their combined stake by NT$14.91 billion, while proprietary dealers added NT$327 million, Taiwan Stock Exchange data showed.
Mutual funds trimmed their combined net position by NT$676.41 million, the data showed.
Heavyweight players such as Taiwan Semiconductor Manufacturing Co (台積電) closed up 1.18 percent at NT$516 ahead of its earnings conference on Thursday next week.
The increase reversed days of retreat after the world’s largest chip supplier on Monday released its first-quarter revenue, which missed its guidance, analysts said.
Tourism firms lent a helping hand after delivering combined revenue on par with business improvement expectations, analysts said.
Shares of Formosa International Hotels Corp (晶華國際酒店集團) grew 4.06 percent to NT$295, while Lion Travel Service Co (雄獅旅行社) closed up 9.82 percent, near the daily limit, at NT$179, exchange data showed.
Speaking on the sidelines of a legislative hearing in Taipei, Vice Premier Cheng Wen-tsan (鄭文燦) said it appeared that foreign institutional investors were ready to rebuild their holdings in the local stock market, which is another reason that the stabilization fund committee at a meeting on Thursday said that it would terminate its intervention.
While the fund would unload the shares it has acquired during its 275-day intervention, that would not affect stock prices, Cheng said.
Additional reporting by CNA
‘SWASTICAR’: Tesla CEO Elon Musk’s close association with Donald Trump has prompted opponents to brand him a ‘Nazi’ and resulted in a dramatic drop in sales Demonstrators descended on Tesla Inc dealerships across the US, and in Europe and Canada on Saturday to protest company chief Elon Musk, who has amassed extraordinary power as a top adviser to US President Donald Trump. Waving signs with messages such as “Musk is stealing our money” and “Reclaim our country,” the protests largely took place peacefully following fiery episodes of vandalism on Tesla vehicles, dealerships and other facilities in recent weeks that US officials have denounced as terrorism. Hundreds rallied on Saturday outside the Tesla dealership in Manhattan. Some blasted Musk, the world’s richest man, while others demanded the shuttering of his
TIGHT-LIPPED: UMC said it had no merger plans at the moment, after Nikkei Asia reported that the firm and GlobalFoundries were considering restarting merger talks United Microelectronics Corp (UMC, 聯電), the world’s No. 4 contract chipmaker, yesterday launched a new US$5 billion 12-inch chip factory in Singapore as part of its latest effort to diversify its manufacturing footprint amid growing geopolitical risks. The new factory, adjacent to UMC’s existing Singapore fab in the Pasir Res Wafer Fab Park, is scheduled to enter volume production next year, utilizing mature 22-nanometer and 28-nanometer process technologies, UMC said in a statement. The company plans to invest US$5 billion during the first phase of the new fab, which would have an installed capacity of 30,000 12-inch wafers per month, it said. The
MULTIFACETED: A task force has analyzed possible scenarios and created responses to assist domestic industries in dealing with US tariffs, the economics minister said The Executive Yuan is tomorrow to announce countermeasures to US President Donald Trump’s planned reciprocal tariffs, although the details of the plan would not be made public until Monday next week, Minister of Economic Affairs J.W. Kuo (郭智輝) said yesterday. The Cabinet established an economic and trade task force in November last year to deal with US trade and tariff related issues, Kuo told reporters outside the legislature in Taipei. The task force has been analyzing and evaluating all kinds of scenarios to identify suitable responses and determine how best to assist domestic industries in managing the effects of Trump’s tariffs, he
Taiwan’s official purchasing managers’ index (PMI) last month rose 0.2 percentage points to 54.2, in a second consecutive month of expansion, thanks to front-loading demand intended to avoid potential US tariff hikes, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday. While short-term demand appeared robust, uncertainties rose due to US President Donald Trump’s unpredictable trade policy, CIER president Lien Hsien-ming (連賢明) told a news conference in Taipei. Taiwan’s economy this year would be characterized by high-level fluctuations and the volatility would be wilder than most expect, Lien said Demand for electronics, particularly semiconductors, continues to benefit from US technology giants’ effort
RSS