Taiwan shares rebound led by semiconductor sector

Taipei, Nov. 7 (CNA) Shares in Taiwan bounced back from the weakness of the previous session to close above 10,800 points on Tuesday as the semiconductor sector attracted buying following a strong showing by integrated circuit stocks on the U.S. market overnight, dealers said.

Contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC, 台積電), the most heavily weighted stock on the local market, led the rise in the local IC sector, while buying also spread to dynamic random access memory (DRAM) chip makers, a reflection of rising product prices pushing the broader market higher, they said.

The weighted index on the Taiwan Stock Exchange closed up 54.15 points, or 0.50 percent, at 10,840.34, after moving between 10,807.89 and 10,842.61, on turnover of NT$124.36 billion (US$4.12 billion).

The market opened up 0.32 percent to pass 10,800 points, reflecting the 1.34 percent increase posted by the Philadelphia Semiconductor Index in the U.S. after IC designer Broadcom Ltd. unveiled a bid to acquire rival Qualcomm Inc. for US$103 billion, dealers said.

Although TSMC led the surge in the local semiconductor sector, the upturn in the weighted index was capped with many investors still staying on the sidelines and waiting for more October sales reports, they said.

Shares in TSMC, the world's largest contract chip maker, gained 1.88 percent to close at the day's high of NT$244.00 with 20.16 million shares changing hands on hopes that the mega merger will lead to an increase in orders placed with the Taiwanese firm, dealers said.

"As long as TSMC gained, riding the waves of rising IC stocks in the U.S. market, it was no surprise the broader market followed," Mega International Investment Services Corp. analyst Alex Huang said. The bellwether electronics sector closed up 0.79 percent and the semiconductor sub-index ended up 1.80 percent.

"However, I prefer to say the buying of TSMC was a knee-jerk reaction to the U.S. market's gains since there is uncertainty over whether the Broadcom and Qualcomm deal will go through," Huang said.

According to the U.S. media, Qualcomm is resistant to the acquisition, saying the price is not attractive.


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