TAIPEI (XFN-ASIA) - Share prices closed lower as a weaker Taiwan dollar hit
financial and other asset-backed stocks, dealers said.
Cathay Financial Holdings led the financial sector lower as its insurance
unit's embedded value growth also fell short of market expectations.
Many investors were on the sidelines waiting for Ma Ying-jeou to take over
as Taiwan's president on May 20 and turn his campaign promises of better
relations with China into concrete initiatives.
The weighted index closed down 126.56 points or 1.41 pct at 8,837.07, off a
high of 8,976.22 and a low of 8,814.48.
Turnover of 156.60 bln twd.
The Taiwan dollar ended the morning session at 30.487 to the US dollar,
compared with the previous close of 30.455.
Cathay Financial plunged 4.80 twd or 5.57 pct to 81.40 on volume of 82.06
mln shares.
Frank Lin, senior vice president with Fubon Securities Co, said the fall of
the local currency triggered fears of capital outflows.
"There were worries over foreign investors' stance toward the domestic
market given recent declines in the local unit," he said.
Financials and companies with big real estate holdings suffered on concerns
about the impact of a weaker currency on Taiwan dollar-denominated assets.
"Investors were eager to lock in profits after the major Taiwan dollar rally
in the first four months of the year," Lin said.
Decliners outnumbered advancers 1,654 to 749, with 244 stocks unchanged.
A total of 32 stocks closed limit-up, while 22 were limit-down.
The financial sector was down 3.98 pct, cement fell 2.28 pct, construction
lost 1.93 pct, textiles dropped 1.79 pct and electronics lost 1.05 pct.
Paper was up 0.58 pct and food rose 0.12 pct.
Asia Cement Corp fell 1.50 twd or 2.63 pct to 55.50 as its unit Asia Cement
(China) Holdings opened its IPO to retail subscriptions today. The unit plans to
sell 375 mln shares at 4.85-6.45 hkd each before listing in Hong Kong on May 20.
Chinatrust Financial Holding shed 1.15 twd or 3.54 pct to 31.35, failing to
respond to news that its subsidiary Chinatrust Commercial Bank is ready to
expand its cooperative relationship with HSBC to embrace yuan conversion in
Taiwan.
Shin Kong Financial retreated 1.55 twd or 5.36 pct to 27.35.
Technology stocks danced to the tune of their US peers.
Asustek Computer fell 0.40 twd to 98.60 despite a report that its unit
Pegatron has begun construction of a production site in the inland province of
Jiangxi in southeastern China.
Hon Hai Precision lost 6.00 twd to 163.00, Taiwan Semiconductor
Manufacturing fell 0.80 twd to 67.20, and United Microelectronics dropped 0.15
twd to 18.80.
Taiwan Pulp & Paper was limit-up 0.95 twd at 15.10.
adela.lin@afxasia.com
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xfnal/xfjamesa
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