Taiwan leaps 2.2pc on hopes of rate cut

TAIWAN share prices closed sharply higher yesterday in heavy trade on buying of speculative stocks by major players, hopes for an interest rate cut and a good profit announcement by Cathay Life Insurance, brokers said.

The weighted index surged 85.28 points, 2.2 per cent, to end at 4,052.38, just off an intra-day high of 4,062. Turnover soared to NT$33.23 billion from Thursday's NT$18.96 billion.

Waves of buying in speculative stocks by major players were seen as soon as the market opened, improving overall market sentiment. Hong Yi Fibre, Formosan Rubber and Tera all closed up by their daily seven per cent limits.

Germany's rate cut on Thursday increased hopes for another easing of monetary policy in Taiwan, said Lin Long-hsien of United Securities.

''General sentiment has been improved again by hopes for a rate cut after the disappointment on the stock tax cut. The market should not perform too badly before the November [local government] elections,'' said Hsu Tsuen-rong of Kingtex. WELLINGTON THE New Zealand share market continued its steady rise, hitting a four-year high in thin and volatile trading dominated by buying in Fletcher Challenge, brokers said.

''We had a bit of charge from mostly private clients in some of the leaders,'' said Cavill White Securities head institutional dealer Tony Gallaugher.

Volume, at NZ$46 million, was reasonable but light by recent weeks' standards, although the day was one of the most volatile the market has seen for a long time because of thin trading in certain stocks.