Taiwan stocks closed down 0.53 percent on Wednesday, and marking the first quarterly loss in more than a year. A further decline is expected on investor concern that Asian governments could tighten their monetary policies further. The main TAIEX finished down 42.16 points at 7,920.06, ending the first quarter down 3.3 percent in the first three-month fall since the end of 2008.
The market remained the worst performer this quarter among MSCI indexes ex-Japan, with the MSCI Taiwan index down 4.2 percent so far this year. "A couple of uncertain factors in Q2: The central banks of Taiwan and China may further tighten monetary conditions, and corporate Q1 results might be disappointing," said Albert Hsieh, an assistant vice-president at Shin Kong Financial's fund unit.
The TAIEX index was expected to trade between 7,300 and 8,300 points in the next three months, he said. All local companies will release their first-quarter results by late April. Banks including Cathay Financial Holding were among top decliners after media reports the sector would not be discussed in talks for a cross-strait free-trade deal, dashing hopes Taiwan banks could ask for favourable terms in tapping the mainland market.
Cathay dropped 2.2 percent, with the financial sub-index 1.4 percent lower. LCD panel maker AU Optronics erased early losses to end up 0.3 percent. A Japanese newspaper reported that the company would buy an LCD plant in Singapore from Japan's Toshiba. The company declined to comment.
Notebook PC maker Asustek slid 0.9 percent. A subsidiary of Asustek has won orders to make Apple's iPhone run on the CDMA standard, a source said on Tuesday. Chunghwa Telecom, Taiwan's top telecom services provider, recouped earlier loss to end flat. Chunghwa would cut its capital and return T$2 ($0.06) per share to its investors, the Commercial Times reported.
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