STOCKWATCH: Taiwan electronics -- 3 (local sector still under consolidation)

At 10:49 am, the electronic sector was up 3.64 pct, while the weighted index was up 157.62 points at 5,563.47 on turnover of 45.64 bln twd.	    An analyst with Grand Cathay Securitiestronic share prices after Dell's confirmation that it will meet its first quarter earnings forecasts.	    "The current buying is a knee-jerk response to a strong rebound on the NASDAQ composite index. The local electronic sector is still under consolidation and I do not think today's gains will be the beginning of a turnaround in electronics share prices," the analyst said.	    The analyst said whether the current gains will be sustainable will depend on a recovery in fundamentals.	    "But, few expect the local electronic sector to report satisfactory first quarter earnings later this month. Under such circumstances, it is unlikely their share prices will make a breakthrough," the analyst said.	    While Dell's news boosted buying in local PC and PC related stocks this morning, the analyst said semiconductor stocks, in particular TSMC and UMC, are the key factor to lead any recovery trend in sector share prices.	    "There has been a consensus that the semiconductor sector will not stage a rebound until the third quarter of this year or even later. A real turnaround in the electronic sector is unlikely to be seen soon," the analyst said.	    According to the analyst, semiconductor stocks account for about 30 pct of the weighting of the entire electronic sector.	    TSMC rose 4.00 to 83.50 twd and UMC gained 2.20 to 51.00.	    Acer added 1.00 to 23.80 and Inventec rose 2.20 to 44.40.	    First International Computer gained 1.10 to 20.20, Arima was limit up 41.70 and Compal was limit up at 58.50.    

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