Taiwan stocks decline

Taiwan stocks suffered from political concerns on Monday, falling 1.32 percent after President Chen Shui-bian's tougher line toward Beijing hurt some China-related shares, such as China Airlines Ltd.
The main TAIEX share index ended down 86.28 points at 6,462.06, with active turnover of T$115.81 billion ($3.52 billion). The day's decline extended Friday's 0.41 percent drop from a 20-month high.
"People had expected Chen Shui-bian to say something that may improve cross-Strait relations, but apparently they were not satisfied," said Albert Lin, manager at Jih Sun Investment Consulting Co.
China Airlines, the island's top carrier, shed 3.76 percent and smaller rival EVA Airways slumped the daily 7 percent limit, pulling the transport sub-index 5.42 percent lower. China Motor Corp, which has substantial investment in China, also fell 2.85 percent.
In his New Year's address on Sunday, Chen warned that Taiwan's economy should not become overly dependent on China. He also reiterated the need for weapons purchases from the United States and revived his call for a referendum by 2007 that could pave the way for a new constitution, measures likely to displease Beijing. Analysts expected Taipei to become more restrictive in approving corporate investment plans in China.
Microchip packaging firm Advanced Semiconductor Engineering Inc lost 4.15 percent as analysts said Chen's speech dashed hopes that the government would allow local chip packaging companies to invest in China.
United Microelectronics Corp (UMC), the world's second-largest contract maker of microchips, fell 2.15 percent. UMC faced more criticism over management share sales on Friday but denied a newspaper report that said its vice chairman was involved in insider trading.
Quanta Display Inc, the market's most actively traded issue by volume, surged the daily 7 percent limit. The issue has risen 37 percent since early November, when Japan's Sharp Corp said it may start procuring LCD panels from Quanta Display since it annot make enough on its own to meet rising demand for its LCD TVs. Coretronic Corp, a major maker of backlight modules for LCD screens, rose 2.0 percent after a local media report that the firm's sales are expected to reach another record in December on robust consumer demand.