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Techs push Taiwan stocks to near 2-week high

Published: 05 Nov 2009 22:16:31 PST

* Big tech plays jump after Wall Street gains, recovery hopes

* ProMOS outperforms after Elpida outsourcing move

* Selling likely emerges next week after rally (Adds details)

TAIPEI, Nov 6 - Taiwan stocks rose 0.61 percent on Friday to a near two-week closing high, led by major technology exporters such as chipmaker UMC <2303.TW> after sharp gains on Wall Street raised optimism over the sector's recovery. Taiwan's main TAIEX share index <.TWII> closed up 45.59 points at 7,463.05 even after a strong earthquake rattled Taiwan after the market closed on Thursday. [ID:nTP132640]

UMC <UMC.N> was the market's second most active stock by volume, up 2.26 percent. Hon Hai <2317.TW>, which supplies electronics parts and assembles PCs for top U.S. brands, jumped 0.76 percent, lifting the electronics sector <.TELI> 0.43 percent.

However, some analysts warned that selling could emerge at any time next week after a 63 percent rally so far this year.

"Foreign investors have been sellers recently and that should be a sign," said Andrew Deng, assistant vice-president at Taiwan International Securities. [ID:nTP179261]

"If Christmas sales are not good, we'd better be cautious," Deng said, adding that the TAIEX is unlikely to break the 20-day moving averge at around 7,600 points in the near term.

Computer memory chip maker ProMOS <5387.TWO> shot up 3.86 percent after Japan's Elpida <6665.T> said it would outsource manufacturing to ProMOS. [ID:nT213504] Smartphone maker HTC Corp <2498.TW> rose 0.88 percent.

"The fourth quarter might be a little flat or weak but we don't have to be pessimistic about next year," said Kevin Chung, manager at Taiwan's Jih Sun Investment Consulting.

Buying spread to financial shares and other companies with substaintial investments in China amid closer trade ties between Taiwan and China.

Financials <.TFNI> gained 0.7 percent, with Cathay Financial Holding <2882.TW> up 0.86 percent. ---------------------TAIEX IN PERSPECTIVE-----------------

Move on day 0.61 pct

Close on day 7,463.05

2009 intraday high 7,811.92

2009 intraday low 4,164.19

All-time high 12,682.41 12 FEB 1990 ---------------------------------------------------------- (US$1=T$32.5)