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Taiwan: Stocks jump most in a year as Apple suppliers lead surge
[HONG KONG] Taiwanese shares jumped the most in a year amid speculation Apple Inc's latest iPhone model will prove popular, boosting earnings for the island's suppliers.
The Taiex index advanced 2.8 per cent at the close, its biggest gain since Sept 2015. Taiwan Semiconductor Manufacturing Co, a major Apple supplier, posted its biggest gain in a year, while Hon Hai Precision Industry Co, the main assembler of iPhones, added 3.9 per cent.
Apple has jumped 6.5 per cent since Taiwan's markets last traded on Wednesday amid holidays. The island's dollar strengthened by the most since Aug 1 against the greenback.
"It's the Apple story again," said Michael On, president of Beyond Asset Management in Taipei.
"There's a revived optimism that Apple will increase orders for Taiwanese suppliers after better-than-expected sales of the iPhone 7."
T-Mobile US Inc and Sprint Corp said they'd received almost four times as many orders for the iPhone 7 as previous models, fuelling speculation that the new product is off to a faster start than usual. Expectations for the iPhone 7 line had been muted before it was unveiled in San Francisco this month amid slowing growth in global smartphone sales.
The Taiex index traded at 9,152.88, snapping a five-day, 3.9 per cent decline. The benchmark equity gauge fell to a two- month low last week amid fund outflows.
Global funds have sold a net US$722 million of local shares this month, the most in Asia excluding Japan, according to data compiled by Bloomberg. TSMC jumped 5.2 per cent and Hon Hai, the largest listed unit of Foxconn Technology Group, climbed the most since May in Monday's trading.
Apple asked Foxconn to get production ready for more iPhone 7s, Taipei-based Economic Daily News reported on Monday. Among other Apple suppliers, Delta Electronics Inc rallied 8.7 per cent and Pegatron Corp increased 7.2 per cent. Quanta Computer Inc, which assembles the Apple Watch, gained 5.7 per cent.
The local currency strengthened 0.85 per cent to NT$31.42 per US dollar. The yield on 10-year government bonds fell one basis point to 0.74 per cent, Taipei Exchange prices show.