Taiwan Biotech Stocks Rally as Tsai's DPP Seen Boosting Industryby and
DPP wins presidential election, gains legislative majority
Taiex index gains after poll, bucks slump for Asia markets
Taiwan’s biotechnology stocks surged the most in three years on speculation president-elect Tsai Ing-wen will increase funding in the industry to bolster an economy that’s estimated to have grown last year at the slowest pace since at least 2009.
A gauge of biotechnology and medical-care companies in the Taiex index jumped 3.9 percent at the close, the biggest gain among 28 industries. The benchmark index added 0.6 percent. Johnson Health Tech Co. and Phytohealth Corp. soared more than 7 percent.
Tsai, who won this weekend’s presidential election in a surprise landslide for the Democratic Progressive Party, said last month that she would boost Taiwan’s economy by focusing on five industries -- biotechnology, green technology, smart machinery, Internet of Things and national defense. In November, she named a researcher in epidemiology and genomics, Chen Chien-jen, as her running mate.
“People will watch biotech stocks as the sector is the new president’s focus industry,”said Peter Tzeng, senior vice president at IBTS Investment Consulting Co. in Taipei.
Buoyed by Taiwan’s well-educated workforce and access to mainland China’s huge market, Taiwan’s biotechnology sector has been a bright spot in the economy. The sub-index has gained 4.5 percent over the past three months, the best among the groups, while the Taiex slumped 9.2 percent.
"We are adding biotech stocks as it’s favored by the DPP,” Vincent Yang, whose Franklin Templeton SinoAm Conventional Industry Fund has beaten 98 percent of its peers past year, said in an interview last week. “The aging population trend is favorable to the sector too.”