TAIPEI, Nov 4 (Reuters) - Taiwan stocks rose 1.07 percent on Wednesday, as construction plays led a rebound from a one-month closing low on Tuesday, on news that the government will not levy higher property taxes in the near term.

As of 0200 GMT, the main TAIEX share index had climbed 80.41 points to 7,403.34.

"Taiwan stocks followed regional peers on a technical rebound," said Tom Tang, a vice-president at Masterlink Investment Advisory. "This could turn into a more sustainable gain if turnover picks up later in the day."

Construction shares rebounded from sharp falls over the past two sessions after a local newspaper reported that Taiwan's Premier had said the government would not levy higher property taxes until the economic recovery gained strength.

Real estate developer Farglory was up 2.52 percent, while the construction sub-index had jumped 2.96 percent.
Cathay Financial, the island's top listed financial

holding company, rose 1.39 percent, with the banking and insurance sub-index up 1.16 percent.

Taiwan expected to sign a much-anticipated financial services pact with China within the month, a Taiwan government official said on Tuesday.

Technology majors also joined the main board's rise, with TSMC rising 0.51 percent and Mediatek up 0.93 percent. The gains followed strong performances by some of their U.S. peers, analysts said.

TSMC was further encouraged after it won a lawsuit against China's SMIC for theft of trade secrets and patent infringement.

Smaller rival UMC jumped 1.28 percent, shrugging off Morgan Stanley's downgrade on the semiconductor sector and chip giant Intel Corp. on increasing inventories.

Analysts said Taiwan stocks may continue to trade in a tight range as investors awaited comments from the U.S. Fed Reserve on the global economic outlook.

HOT STOCKS

-- Yulon Motor jumped 3.2 percent after a newspaper reported that the Yulon group was likely to assemble and sell cars for China's Geely Motor in Taiwan by the end of the year, with a selling price of T$400,000 ($12,310) per unit.

For a table of foreign trading in Taiwan stocks, double-click on ID:nTP170358 ((Reporting by Joan Hsu; Editing by Chris Lewis))
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