TAIEX slumps on decreased US consumer confidence

Stocks fell, led by chipmakers such as Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), on concern demand will slump after US consumer confidence tumbled to a nine-year low this month.

Stocks also dropped after Macronix International Co (旺宏電子), Micro-Star International Co (微星科技) and other companies reported earnings that fell from a year earlier.

The TAIEX lost 55.40 points to close at 4,498.73.

Almost seven stocks fell for every four that rose. The total value of trade was NT$80.08 billion (US$2.3 billion).

In the US, the Conference Board said its index of consumer confidence fell to 79.4, the lowest since November 1993, from 93.7 in September. The US is the second-largest buyer of computers and various other exports from Taiwan.

TSMC, which sold about three-quarters of its chips to US customers in the third quarter, fell NT$1.30, or 2.8 percent, to NT$45.50.

Rival United Microelectronics Corp (聯電) fell NT$0.90, or 3.5 percent, to NT$24.50. After the market closed, the world's second- largest supplier of made-to-order chips reported third-quarter profit of NT$1.4 billion, lagging analysts' expectations.

"People don't have confidence in electronics stocks," said Joey Chen, who manages US$88 million in stocks at Fidelity Investment Securities Investment Trust Co.

"The US economy is bad and Christmas-season buying isn't that strong, so prices are going to reflect this bad situation," he said.

Micro-Star fell NT$3.50, or 4.9 percent, to NT$67.50. Taiwan's third-largest maker of boards connecting the chips that run computers posted third-quarter profit of NT$704 million, 30 percent lower than a year ago, as profit margins fell.

Macronix fell NT$0.65, or 5.5 percent, to NT$11.20. Taiwan's biggest maker of memory chips for electronic games turned to a third-quarter loss of NT$2.1 billion, from NT$39.1 million a year earlier.

Advanced Semiconductor Engineering Inc (日月光) fell NT$0.50, or 2.6 percent, to NT$18.90.

The chip packager forecast fourth-quarter sales will drop as much as 5 percent from the third quarter.

The one bright spot was the transportation sector, which rose 4.6 percent. The rise came after China signaled that Beijing might be ready to set aside political differences and discuss restarting direct shipping and air links with Taiwan.

China Airlines Co (華航), Taiwan's largest carrier, rose NT$1, or 6.9 percent, to NT$15.60.

China Development Financial Holding Corp (中華開發金控) fell NT$0.40, or 2.9 percent, to NT$13.45. Taiwan's third-largest financial holding company cut its pretax profit forecast for the year by 58 percent to NT$6.66 billion, after posting nine-month net income of NT$6.87 billion.