tw stock 1215

14:15 15Dec2008 RTRS-Taiwan stocks rise on cross-strait links, US gains

* Tech shares track Wall St rise, hopes of auto bailout
* Transport, tourism shares surge on launch of direct links
* Powerchip rises after plans for state assistance
* Financial shares up on hopes of cross-strait MOU

(Updates quote, details)
Gina Chang
TAIPEI, Dec 15 (Reuters) - Taiwan stocks ended up 2.96 percent
on Monday, with shares of export-oriented technology firms such
as TSMC <2330.TW> rising on renewed hopes the U.S. auto industry
would be bailed out.
Transport and tourism shares also propped up the market, as
Taiwan and China launched their first direct cargo links in six
decades.
The TAIEX share index <.TWII> ended up 132.45 points at
4,613.72, bouncing back from a 3.74 percent fall in the previous
session.
Turnover was at T$71.1 billion ($2.1 billion), lower than
T$90.2 billion in the previous session.
"The market was boosted by Wall Street gains. Investors were
anticipating a bailout for the U.S. auto makers," said Wang
Kao-hsiung, a vice president of KGI Securities.
The electronics sub-index <.TELI> advanced 3.73 percent,
tracking gains on Wall Street and in other Asian peers on
expectations of a U.S. auto bailout.
Taiwan Semiconductor Manufacturing Co (TSMC) , the
world's top contract chip maker, jumped 3.95 percent.
Smartphone maker HTC Corp <2498.TW> and chip designer
Mediatek <2454.TW> both surged by their daily 7 percent limit.
The transport sub-index <.TTPI> yielded some strong gains in
early trade and rose 2.56 percent, after China and Taiwan
launched daily flights, new shipping routes and postal links on
Monday in a further thaw of once icy relations between the two
rivals. [ID:nTP350629]
"Gains in transportation stocks were not as strong as we
expected, possibly because the launch of direct cross-Strait
links has been factored in," said KGI's Wang.
"Now investors will wait and see the actual effect of the
cross-Strait links," he said, adding he expected the market to
trade between 4,400-4,650 points this week.
Shares of top shipping companies Evergreen Marine <2603.TW>
and Yang Ming <2609.TW> were up 0.63 percent and 1.83 percent,
respectively.
The tourism sub-index <.THOI> gained 0.97 percent, with
Formosa Regent <2707.TW>, a major hotel chain operator, rising
3.27 percent.
The financial sub-index <.TFNI> climbed 3.61 percent,
boosted by a newspaper report on Monday that stock exchange
chairman Schive Chi will travel to China later this month to
visit the Shanghai stock exchange where he will discuss details
of a future memorandum of understanding (MOU).
The market will also watch closely as media reported that the
National Stabilization Fund will meet later on Monday to
determine whether or not to extend by a month its activity in the
market, set to expire this week.
"I don't think the fund will continue its activity especially
as the market surged today. Besides, government funds can hardly
support the market, which mainly moves on the outlook of the
economy," said Michael On, a managing director of Beyond Asset
Management.

HOT STOCKS:
-- DRAM maker Powerchip <5346.TWO> rose 4.29 percent after
the company and its Japanese partner Elpida Memory Inc <6665.T>
said they were considering selling stakes in their Taiwanese
joint venture and asking for state aid as the DRAM industry
crumbles. [ID:nT115330]
-- Mega Financial <2886.TW>, Taiwan's No.2 state-controlled
financial holding firm, ended up 5.12 percent. Smaller rival
Taiwan Business Bank <2834.TW> jumped 3.4 percent.
Mega is considering reviving its plan to acquire Taiwan
Business Bank, a finance ministry