Taiwan stocks ended lower on Thursday with electronics shares leading losses after Goldman Sachs downgraded index heavyweights TSMC and UMC and US tech stocks fell sharply overnight.
The TAIEX share index lost 1.65 percent to finish at 5,867.51, extending its retreat after meeting heavy technical resistance at 6,000 points on Tuesday and Wednesday.
Taiwan Semiconductor Manufacturing Co (TSMC) lost 3.64 percent and United Microelectronics Corp (UMC) gave up 3.76 percent after Goldman cut its ratings on the world's two largest contract microchip makers to "in-line" from "outperform".
UMC was the day's most actively traded issue with 198 million shares changing hands in the day's sluggish trading.
"The downgrade certainly had an impact on the market. It has caused buyers to pull their hands away from electronics stocks," said Hotung Securities analyst Albert Lin. "Institutional investors are reducing their holdings even further."
Trading was slow with turnover of just T$68.7 billion, up just slightly from T$65.3 billion on Wednesday.
The heavily weighted electronics sub-index was the day's biggest decliner, losing 2.73 percent as Wednesday's 3.24 percent decline in the Philadelphia semiconductor index added pressure to Taiwan's tech issues.
Nearly all sectors suffered losses. Financial shares wobbled as lawmakers discuss a rescue fund for bad loans before the current legislative session ends on Friday.
The over-the-counter TAISDAQ index fell 1.13 percent to finish at 127.39, while June TAIEX futures dropped 120 points, or 2.01 percent, to close at 5,840, expanding its discount over the spot market.
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