Taiwan stocks fell 0.42 percent on Thursday, led by technology shares, as Microsoft's delayed launch of its new operating system hit counters such as PC maker Acer Inc for a second day.
The main TAIEX share index lost 26.66 points to 6,364.60, with turnover of T$85.32 billion (US $2.6 billion). The electronics sub-index fell 0.63 percent, while the bank and insurance index inched down 0.04 percent.
Analysts said a government plan to tighten investments in China had also dampened sentiment, but believed the impact should be limited.
"From how the market is reacting, I really don't think too many people care anymore about a tightening of investments in China," said Sinopac Securities research manager Alvin Teng.
"It does not affect the fundamentals of local companies and during this slow season, the market will consolidate until late April," he said.
"In April, after major companies report net profit growth and good performance, that is when the market will trend favourably."
Acer fell 5.84 percent, but Compal Electronics Inc, the world's second largest contract maker of laptop computers, advanced 1.27 percent.
World No 3 LCD maker AU Optronics rose 0.64 percent after it signed a cross-licensing agreement with Japan's Sharp Corp on Wednesday.
Reports from local and foreign newspapers that Dell Inc plans to introduce 20-inch flat screen monitors in the second half of this year drove up shares for Taiwan's panel makers, but analysts say pricing and consumer acceptance will be key issues.
Taiwan Semiconductor Manufacturing Co (TSMC), the world's top contract chip maker, was flat, while shares in smaller rival United Microelectronics Corp (UMC) were also unchanged at T$18.95.
Foreign and domestic investors locked in profits in recent high-fliers such as mobile phone maker High Tech Computer (HTC) which dropped 3.91 percent to T$836.
Taiwan's President Chain Stores Corp gained 0.6 percent after the firm announced that full 2005 year net profits rose 20 percent from a year earlier.
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