Taiwan stocks at two-week closing low

Taiwan stocks fell 0.31 percent on Monday to a fresh two-week closing low, with Compal dropping on a weaker 2009 shipment outlook and investors turning cautious before major US firms post earnings results. The main TAIEX share index closed down 13.63 points at 4,453.90, its weakest finish since December 29. Turnover was thin at T$55.9 billion ($1.7 billion), but up from T$43 billion in the previous session.
"Trading volume was light. Both stock buying and selling have become less active ahead of earnings results by major US firms this week," said Nigel Lee, a portfolio manager of National Investment Trust.
"However, unless there comes any surprising bad news from the US, Taiwan's market will trade in a tight range." Lee expected the market to trade between 4,350-4,600 points this week as investors were reluctant to trade before the market closes for Lunar New Year holidays from January 22 through February 1.
Compal Electronics, the world's second-largest contract laptop maker, fell 0.62 percent after saying on Saturday its shipments this year could be 8.6 percent below its previous target due to the global slowdown. Quanta Computer, Compal's larger rival, lost 3.54 percent. The electronics sub-index inched up 0.06 percent, with Taiwan Semiconductor Manufacturing Co (TSMC), the world's top contract chip maker, 1.59 percent higher.
Shares of AU Optronics, the world's No 3 flat panel maker, fell 4.82 percent and smaller rival Chi Mei ended flat. Some LCD makers are having trouble finding workers after a surge in orders in December, as recently laid-off employees opt to remain on unemployment rather than risk going back to work only to be laid off again, a newspaper reported on Monday.
The market fell on Saturday after the top financial regulator decided to stick with the new accounting rule. Most analysts said a delay in the new rule would provide little help for companies, if demand for their products remains weak.
A newspaper said on Monday the government was studying possible amendments to a new inventory-related accounting rule that has raised concerns among the business community. The financial sub-index was down 1.87 percent, dragged by Cathay Financial, Taiwan's top listed financial holding firm, which lost 2.16 percent. Cathay Financial posted on Saturday a net loss of T$1.37 billion in the fourth quarter and finished 2008 with its lowest profit since 2001.