Taiwan shares reach record high Taiwan shares reach record high

CAUTIOUS OPTIMISM: Investors rotated into old-economy industries, with the Formosa Plastics Group in the spotlight, an analyst said

Taiwanese shares closed at a fresh high yesterday, but gains were capped as the benchmark index remained below the 50,000-point mark, with investors turning cautious as it approached the psychologically important level.

The TAIEX closed up 110.51 points, or 0.22 percent, at 49,822.55, with market turnover totaling NT$975.935 billion (US$30.71 billion) on the main board, Taiwan Stock Exchange data showed.

Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), whose American depositary receipts rose 2.75 percent overnight amid the ongoing artificial intelligence boom, gained 0.39 percent to close at another high of NT$2,585.

Journalists work in front of an electronic stock board at the Taiwan Stock Exchange in Taipei yesterday.

Photo: CNA

“As the 50,000-point mark neared, some investors sold shares to lock in gains,” Concord Securities Co (康和證券) analyst Kerry Huang (黃志祺) said. “Fortunately, TSMC stayed resilient and still posted gains after retreating from an intraday high, helping the broader market break its previous closing record.”

TSMC, which accounts for more than 40 percent of the main board’s total value, contributed about 80 points to the TAIEX’s rise, the exchange’s data showed.

“Interest in TSMC showed that investors expect the chipmaker to provide upbeat guidance on its business outlook and overseas expansion at an investor conference scheduled for Oct. 15,” Huang said.

However, as profit-taking largely focused on large-cap tech stocks, investors rotated into select old-economy industries, with major companies in the Formosa Plastics Group (台塑集團) in the spotlight yesterday, he said.

“Meanwhile, US Treasury yields are still rising,” Huang said. “I am afraid that if yields go up further, tech firms will feel the pinch from higher fundraising costs, which could affect their operations and, in turn, their share prices, which tend to move closely with those of their Taiwanese counterparts.”

The benchmark US 10-year Treasury yield hit 5.34 percent overnight, its highest level since April 2002.