Taiwan stocks fell 1.5 percent on Monday to their lowest close in two weeks, as investors cashed in on recent share gains of major technology exporters such as Hon Hai ahead of the meeting of the US Federal Reserve. The main TAIEX share index ended down 131.72 points at 8,899.91.
Lower turnover of T$108.17 billion ($3.3 billion) reflected the cautious mood after the local market staged a 10 percent rebound from a trough hit in mid-August. "We got the Fed factor now and, in the longer term, the possible impact from the subprime market woes remains a big concern," said Grand Cathay Securities analyst Kevin Yeh.
Electronics parts maker Hon Hai Precision Industry Co, which makes desktop PCs for major US brands, slid 2.8 percent and Taiwan Semiconductor Manufacturing Co Ltd (TSMC), the world's top contract chip maker, lost 1.6 percent. "If US consumption weakens, we probably will see the inventory problem in the tech sector early next year," Yeh said.
The bellwether electronics sub-index fell 1.9 percent and the financial sector dropped 1.1 percent. But Chunghwa Picture Tubes (CPT), the island's third-largest LCD maker, rose 2 percent after the firm said it was receiving a $250 million investment from Warburg Pincus. Its bigger local rival, AU Optronics Corp, lost 1.7 percent. Chi Mei Optoelectronics Corp was 1.6 percent lower.
Topco Scientific, Taiwan's biggest distributor of silicon wafers, gave up early gains to finish down 3.1 percent. The firm gave upbeat sales forecasts for this year and next year in an interview with Reuters on Friday but the projections were below market expectations.
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