Apple scare brings big drop in TAIEX

The TAIEX fell to its lowest this year, led by Quanta Computer Inc (廣達電腦), on concern US demand for the nation's components will decline after Apple Computer Inc cut its third-quarter profit forecast.

The TWSE Index fell 136.92, or 2.5 percent, to 5399.50, as about 14 stocks fell for every one that rose. The total value of trade was NT$63.5 billion (US$1.86 billion).

Quanta, which makes Apple's new iMac with a flat-panel display, fell NT$6, or 6.6 percent, to NT$85.50. Apple lowered its third-quarter profit forecast by as much as 27 percent as sales dropped below its earlier estimates.

"Apple's outsourcing to Taiwan is increasing this year," said Lloyd Tsai (蔡隆裕), who helps manage about US$77 million in stocks at Invesco Taiwan Ltd (景順投信). "Quanta may be impacted" by the lowered forecast.

Chipmaker United Microelectronics Corp (UMC, 聯電) fell NT$1.30, or 3 percent, to NT$42 after Advanced Micro Devices Inc said second-quarter sales will miss an earlier forecast. UMC makes chips for Advanced Micro.

Aurora Corp (震旦行) slumped NT$0.70, or 6.7 percent, to NT$9.75 after the maker and distributor of office equipment and mobile phones said it plans to reduce the number of its outstanding shares by canceling 45 percent of its stock to counter last year's loss of NT$3.2 billion.

Yageo Corp (國巨), Taiwan's largest maker of parts controlling electricity in computers and mobile phones, fell NT$0.60, or 3.1 percent, to NT$18.80 on a local media report that its first-half loss may reach as much as NT$2 billion.

At the Taipei foreign exchange market, the New Taiwan dollar turned stronger against the US dollar, rising NT$0.018 to close at NT$34.099. Turnover totalled US$380 million, compared with the previous day's US$473 million.

The local currency opened at NT$34.105 against the greenback, and was traded in a range between NT$34.088 and NT$34.105.