Taipei shares close higher on Wall St, apparent govt funds support

TAIPEI (AFX-ASIA) - Share prices closed higher in increased turnover on the back of Wall Street's upturn overnight on prospects of further rate cuts and amid apparent support from government funds, dealers said.

	    They said government funds' apparent support for stocks that went ex-dividend earlier, including Systex, Compal and Winbond, outweighed concerns over foreign investors turning net sellers yesterday. 

	    Foreign investors were net sellers of shares worth 299.25 mln twd yesterday, ending some two weeks of consecutive net buying.

	    But investors were reluctant to chase prices much higher, awaiting President Chen Shui-bian's remarks scheduled tomorrow and MSCI announcements on indice adjustments.

	    The weighted index closed up 61.42 points or 1.21 pct at 5,143.44, off a high of 5,175.53. 

	    Volume was 1.59 bln shares worth 50.89 bln twd. 

	    Advancers led decliners 384 to 108, with 99 stocks unchanged. 

	    Some 30 stocks closed limit-up and five limit-down.

	    The food, textiles, cement, electronics, paper, construction, petrochemicals, and financials sectors were up 2.09 pct, 1.90 pct, 1.64 pct, 1.54 pct, 0.94 pct, 0.91 pct, 0.47 pct, and 0.27 pct.

	    The Taiwan dollar was at 32.952 against the U.S. dollar, from yesterday's close of 32.957.

	    Capital Management Co Ltd assistant manager Johnny Lee said electronics shares led the bourse higher following Wall Street's overnight rally, and NASDAQ's gains in particular.

	    In addition, conglomerate stocks outperformed the market.

	    "Conglomerate stocks staged a strong showing thanks to apparent major shareholders' support."

	    "Conglomerate stakeholders might have (bought) shares to show their support for President Chen in the run-up to the anniversary (of his inauguration on May 20)."

	    An official from the presidential office said the theme of the President's remarks tomorrow will be that the peaceful power transfer is still evolving.

	    "I don't expect Chen to announce any aggressive relaxation in direct links (with China) as Beijing hasn't indicated much of a favourable response 

to Chen's previous friendly messages."

	    The market's upturn today was curbed by lingering concerns over economic fundamentals and corporate earnings in the current quarter, he added.

	    Chen's remarks before he leaves for an overseas visit on May 21 and the MSCI announcements will be key to the local bourse's short-term prospects.

	    TSMC rose 1.00 twd to 89.00 and UMC added 1.00 to 51.50, following the rally by their U.S. counterparts overnight.

	    Systex rose 1.50 to 43.20, Compal was limit-up 2.80 at 42.90 and Winbond rose 0.90 to 30.30.

	    Pacific Electric was limit-up 0.60 at 9.80, Shinkong Life Insurance gained 1.20 to 24.00 and China Steel rose 0.30 to 19.10 on apparent support from conglomerate shareholders.

	    China Development rose 0.70 twd to 28.40. It expects to realize net gains of 2.85 bln twd from the planned sale of 52.87 pct in China Securities 

Investment Trust Corp to HSBC Asset Management.

	    Hocheng added 0.65 to 10.90 after disclosing a China joint venture plan.

	    Far Eastern Textile rose 1.00 twd to 18.60 after announcing a share buyback scheme.

	    Asia Cement rose 0.15 twd to 11.70 after a report of a China investment plan.

	    Elitegroup gained 8.50 twd to 147.00 and Accton rose 2.30 to 43.80 ahead of going ex-dividend.

	    Macronix lost 1.70 twd to 42.40 on concerns over product price prospects, dealers said.

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