Taiwan stocks decline

Taiwan shares fell 0.98 percent on Monday to their lowest close in nearly one month, pulled down by tech exporters such as Hon Hai, following losses on Wall Street and after foreign investors sold a record amount of local shares last Friday.
The main TAIEX share index declined 89.71 points to end at 9,072.57, with turnover falling to T$213.09 billion ($6.5 billion) from T$295.54 billion on Friday, when the TAIEX marked its largest drop in more than one year. "The index was around 10 percent overbought, and we expect the correction to continue throughout this quarter as investors closely monitor US market movements," said Primasia Securities analyst Takao Fujiki.
"There's no reason to buy too much on the market now and many investors are already locking in profits until the end of the year," said Fujiki. The broader semiconductor subindex was down 0.29 percent and the bank and insurance index fell 1.61 percent.
The TAIEX slumped 4.22 percent on Friday, its biggest drop since June 8 last year, after a United States equities sell-off spurred widespread selling in global markets.
Hon Hai Precision Industry Co, which makes iPhones for Apple and computers for Hewlett-Packard, declined 0.19 percent after the S&P 500 index logged its worst one-week fall in almost five years. However, Taiwan Semiconductor Manufacturing Co (TSMC), the world's top contract chip maker and the market's most heavily weighted stock, reversed earlier losses and gained 1.56 percent.
"TSMC's stock was oversold within the past three weeks and after it gave positive guidance, investors are buying it back," said Fujiki. Its smaller rival, United Microelectronics Corp (UMC), fell 0.27 percent. US stocks plunged last week for two straight sessions, with the Dow Jones industrial average down more than 200 points on Friday.
Sino American, jumped the daily 7 percent maximum to T$343.00, after the Economic Daily News said US-based MEMC Electronic Materials Inc, a supplier of silicon wafers to the microchip industry, planned to give large orders to Sino American amid a rise in demand for solar power and renewable energy. Smartphone maker High Tech Computer (HTC) rose 2.82 percent after reporting a rise in second-quarter net profit and sales.
Citigroup analyst Dale Gai rates HTC at "buy" as he expects limited earnings downside in the next three to six months. However, CLSA analyst Vincent Chen wrote in a research report that HTC's business model may be stuck between the brand and contract business side. The investment bank currently rates HTC as "underperform."