Taipei shares sharply lower as Wall St, Fed policy concerns rule early trade

Taipei shares sharply lower as Wall St, Fed policy concerns rule early trade

	Published : Wed, 29 Aug 2007 03:47 By : Agencies Print this Story

TAIPEI (XFN-ASIA) - Share prices were sharply lower in early trade as the plunge on Wall Street overnight due to persistent credit concerns in the US weighed on local trading sentiment given an absence of major local leads.

The local market sagged under pressure from a global downturn as investors tried to digest the minutes of the last US Fed meeting, which have raised doubts on Wall Street about whether the central bank would cut interest rates to alleviate the credit squeeze.

As of 9.59 am, the weighted index was down 171.07 points or 1.96 pct at 8,556.48, off a low of 8,514.47 and a high of 8,569.84.

Turnover was 50.67 bln twd.

Decliners outnumbered advancers 1,535 to 186, with 106 stocks unchanged.

Seven stocks were limit-up, while 16 were limit-down.

The paper sector was down 2.69 pct, financial down 2.66 pct, cement down 2.27 pct and electronics down 2.22 pct.

'We are experiencing a vicious cycle, with the New York again setting the tone for the global markets,' said an assistant vice president with a domestic securities investment trust company.

'Regional market (trends) are being dictated by Wall Street, and Taiwan is not immune from such kind of jitters,' he said.

He added that there have been no major policy or corporate leads for the local market so far to provide any positive distraction for investors here.

'Given Taiwan's heavy reliance on exports, the major concern is the impact of the credit crunch on the US economy and consumption power.'

Investors kept a wary eye on the chain effect of any US consumption downswing on demand for the island's technology products, he added.

Some individual stocks rose on specific corporate leads, such as Chunghwa Telecom Co Ltd, which gained 0.70 twd, or 1.28 pct, to 55.50 as investors found a good excuse to buy the stock in the company's announcement of a share repurchase plan.

Taiwan Cooperative Bank shed 0.55 twd, or 2.46 pct, at 21.80 on a report that Cathay Financial Holdings unit Cathay Life Insurance Co Ltd has been disposing of its holdings in Taiwan Cooperative Bank since June. Cathay Financial lost 3.20 twd to 69.70.

Qisda (formerly BenQ) Corp shed 0.60 twd to 15.10, failing to benefit from news that it made a capital gain of 380 mln twd from the cumulative sale of 4.64 mln shares in unit Darfon Electronics Corp at 103.00 twd per share on Monday and yesterday.

adela.lin@afxasia.com

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