Taiwan stocks fall

16 Oct, 2008

Taiwan shares fell 0.86 percent on Wednesday, retreating from a 5.4 percent jump in the previous session, as technology shares such as TSMC dropped on worries that a global economic slowdown would hurt demand. The main TAIEX share index fell more than 2 percent by midday, cutting the loss to end down 45.30 points at 5,246.26.
It saw its best day in three weeks on Tuesday joining in a global rally on hopes the financial crisis can be contained. Taiwan's major technology companies will kick off the domestic earnings season from next week, and most of them are widely expected to report poor third-quarter results. Cautious investors stayed on the sidelines, with turnover shrinking to T$53.4 billion ($1.6 billion) from the previous session's T$67.5 billion.
The world's leading contract chip maker, Taiwan Semiconductor Manufacturing Co (TSMC), lost 3.41 percent, pulling the broader electronics sub-index down 0.99 percent. TSMC, which sells the bulk of its products to major clients in the United States, is set to report its third-quarter earnings and give guidance for the fourth quarter in late October.
AU Optronics, the world's No 3 LCD flat panel maker, fell 0.94 percent after UBS cut its target price on the Taiwan firm, saying the company will likely post losses in the second half. Larger South Korean rival LG Display Co Ltd posted a 44 percent drop in quarterly net profit on Tuesday, and the industry outlook looks tougher still as a economic downturn hits demand for flat TVs and personal computers.
Taiwan on Sunday said it would halve the daily limit that stock prices can fall and extend a ban on short selling, in its latest moves to prop up the stock market. Cathay Financial, the island's largest listed financial holding firm, ended flat and Fubon Financial lost 0.26 percent. The financial sub-index declined 1 percent.

Read Comments