Taiwan stocks rose 1.1 percent on Thursday to another seven-year closing high, bolstered by gains in DRAM chip makers such as Nanya Technology Corp amid recovering PC demand. The main TAIEX share index reversed early losses to close up 96.11 points at 8,851.99.
As foreign investors stepped up buying of local shares, the Taipei market has risen by about a fifth since the year's trough in early March. The electronics sub-index rose 1.42 percent, while the financial sector eased 0.33 percent after rallying the previous day on hopes that Taiwan's central bank will raise interest rates at its quarterly meeting later in the day.
"DRAM prices have hit bottom, so it's the right time to increase holdings on them," said Grand Cathay Securities analyst Kevin Yeh. Major memory chip makers across Asia rose on Thursday following rising spot prices of computer memory chips. Powerchip Semiconductor Corp and Nanya Technology Corp, Taiwan's two largest makers of dynamic random access memory (DRAM) chips, gained 2.26 percent and 3.47 percent, respectively. Nanya hit its highest level in nearly 5 years.
Taiwan Semiconductor Manufacturing Co Ltd (TSMC), the world's biggest contract chip maker, gained 1.32 percent, extending a near 4 percent surge in the previous day. On the technical charts, however, Taiwan's 14-day relative strength index remained high at 91.117 on Thursday, implying that selling might emerge any time. "There're risks if you want to chase stocks after strong gains in recent trading," said Grand Cathay's Yeh.
Fubon Financial rose 0.49 percent. A local newspaper reported that Fubon would separate its banking and insurance businesses into two holding companies to better help them focus on their specialities and seek foreign investment.
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