TSMC shares up on Philadelphia Semiconductor Index gains
Central News Agency
2014-02-14 12:00 PM
Taipei, Feb. 14 (CNA) Shares of Taiwan Semiconductor Manufacturing Co. (TSMC) moved higher Friday morning as investors were encouraged by the rise of the Philadelphia Semiconductor Index on Wall Street overnight, dealers said. The strong showing by TSMC, the world's largest contract chip maker, also reflected optimism toward its bottom line amid market speculation that it is likely to secure orders for a new generation of chips for Apple Inc., dealers said. On the back of TSMC's uptrend, the local high-tech sector staged a rebound, pushing up the benchmark weighted index on the Taiwan Stock Exchange soon after the market opened, according to dealers. As of 11:17 a.m., shares of TSMC had gained 1.90 percent, rising to NT$107.00 (US$2.53), with 25.60 million shares changing hands. The semiconductor sub-index had climbed 1.29 percent and the weighted index was up 0.81 percent at 8,536.40 points. "TSMC is a fundamentally healthy company, one of the favorites of foreign institutional investors," Hua Nan Securities analyst Kevin Su said. "Investors simply seized the gains posted by TSMC's counterparts in the U.S. market as a reason to buy into the stock this morning," he said, referring to the 1.19 percent rise of the Philadelphia Semiconductor Index overnight. Meanwhile, shares of U.S.-based Applied Materials Inc., the largest supplier of semiconductor production equipment, gained 5.36 percent on expectations that its clients would increase production and thus boost the company's sales. "In addition, foreign business wires have reported that TSMC is likely to secure orders to produce the new generation of chips for Apple as rival Samsung Electronics Co. has a low yield rate," Su said."That could further boost TSMC's bottom line." In 2013, TSMC's net profit hit a record high, with earnings per share (EPS) of NT$7.26, compared with NT$6.41 in 2012. The chip maker's consolidated sales climbed by an annual 17.8 percent to NT$59.70 billion, a record high in the company's history. "My brokerage expects TSMC's EPS for 2014 will rise further to NT$8.4. If the company secures orders from Apple, as reported, its net profit could climb even higher," Su said. Although global index provider MSCI Inc. cut TSMC's weighting in the MSCI indices by 0.03 percentage points, the chipmaker's shares picked up steam Friday morning amid optimism toward its bottom line. "As today's gains helped TSMC shares overcome the stiff technical resistance at NT105.00, I expect the stock to continue to move higher," Su said. Led by TSMC, the local electronics sub-index had risen 0.94 percent as of 11:17 a.m., boosting the broader market as the stock is the most heavily weighted in the local market, he said. (By Frances Huang)
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