Taiwan stocks in biggest 1-day pct gain in 3 months

Published: 27 Jan 2010 23:14:42 PST

* TSMC up before posting better-than-expected Q4 profit

* AU jumps before reporting Q4 losses

* Financials rise as Taiwan oks investment in China banks

* HTC down for 2nd day after weak profit margin forecast (Adds quotes, moving stocks, details)

TAIPEI, Jan 28 - Taiwan stocks rose 1.78 percent to post their biggest percentage gain in nearly three months on Thursday, led by Chi Mei <3009.TW> after gains on Wall Street and data showing strong demand for Taiwan's exports.

The U.S. Federal Reserve offered a guardedly upbeat view of the U.S. economy, helping steady investor nerves after recent sharp declines [ID:nN27180815].

A 0.8 percent rise in Taiwan's index of leading indicators in December from a month earlier [ID:nTOE60Q08W] also helped boost sentiment.

"The Fed Reserve's move boosted gains in Taiwan stocks as investors are not as worried as they were before," said Kevin Lin, a vice president with Fuh Hong Financial Planning.

The main TAIEX share index <.TWII> ended up 1.78 percent or 134.55 points at 7,694.58, marking its best one-day percentage jump and biggest point gain since Nov. 4.

Turnover was flat at T$118.1 billion ($3.7 billion), compared with Wednesday's T$119 billion.

The gain was also widely seen as a rebound following a 10 percent slump in the prior eight sessions combined.

"Taiwan stocks rebounded technically after falling more than any other Asian peers," Lin said.

HOT STOCKS

-- TSMC <2330.TW>, the world's top contract chip maker, ended up 0.67 percent, pushing up the electronics sub-index <.TELI> by 2.1 percent. After the market close, the company posted a forecast-beating profit in the fourth quarter. [ID:nTOE60O05J]

-- AU Optronics <2409.TW>, the world's No.3 flat panel maker, advanced 3.7 percent.

Shortly after market close, AU reported a quarterly loss, raising concern over the sustainability of the current recovery in the sector. [ID:nTPU002100]

Smaller rival Chi Mei Optoelectronics <3009.TW> was 7 percent limit up.

-- Banking shares <.TFNI> rose 1.6 percent with Cathay Financial <2882.TW>, the island's top listed financial holding firm, gaining 1.7 percent. After the close its fund unit said it would apply next month to the Chinese government to invest up to $200 million in Chinese stocks [ID:nTPU002103]

Fubon Financial <2881.TW>, parent of Taiwan's No. 2 life insurer, climbed 2.3 percent.

The gains come as Taiwan has given preliminary approval for local banks to invest in Chinese lenders, which would provide growth opportunities. [ID:nTOE60Q048]

-- Hon Hai <2317.TW> rose 2.3 percent. Hon Hai, Taiwan's biggest electronics parts maker, has been named by UBS as the assembler of Apple Inc's <AAPL.O> new iPad tablet PC. [ID:nN27184896].

-- Bucking the gains was HTC <2498.TW>, the world's No. 4 smartphone brand.

HTC fell 2.5 percent, extending its slide to almost 10 percent in two sessions, after making a profit margin forecast below expectations. [ID:nTOE60Q02C] --------------------TAIEX IN PERSPECTIVE--------------------

Move on day 1.78 percent

Close on day 7,694.58

2010 intraday high 8,395.39

2010 intraday low 7,828.34

All time high 12,682.41 12 FEB 1990 ------------------------------------------------------------

For a table of foreign trading in Taiwan stocks, double-click on [ID:nTP170358]