Formosa Plastics, DBTEL lead decliners

Stocks dropped for a fourth day, led by Formosa Plastics Corp (台塑), after a local newspaper said the price of plastic rose because of higher costs, not increased demand.

"Now that demand's not so strong, customers who have restocked are going to hold off buying," said Raymond Yang (楊晴華), a petrochemicals analyst at KGI Securities Co (中信證券).

The TAIEX shed 81.56, or 1.8 percent, to close at 4,588.14. For the week, the index fell 3.2 percent, its biggest fall since the week ending Oct. 11.

Formosa Plastics lost NT$1.20, or 2.6 percent, to NT$45. Nan Ya Plastics Corp (南亞塑膠) dropped NT$0.60, or 1.9 percent, to NT$30.30.

The price of polyvinyl chloride rose because of a shortage of raw material used to make it, rather than higher demand, the paper reported. Customers, who increased their inventories to avoid rising prices, now have supplies to last until the second quarter, it said.

Within the index, more than seven stocks fell for every two that rose. The total value of trade was NT$78.05 billion (US$2.24 billion).

China Steel Corp (中鋼) rose NT$0.50, or 2.6 percent, to NT$20. The steelmaker expects pretax profit next year to climb to more than NT$36 billion, a local newspaper reported.

The company, which forecasts a NT$18.5 billion pretax profit this year, said it will announce its forecast on Dec. 17 after a board of directors meeting.

CMC Magnetics Corp (中環) added NT$0.25, or 1.8 percent, to NT$14.05. The world's second-largest maker of recordable compact discs plans to spend as much as NT$950 million to buy back 50 million shares, or 1.9 percent of its outstanding stock, starting today, for one month.

DBTEL Inc (大霸電子) fell NT$1.50, or 6.7 percent, to NT$21. The phone-equipment maker cut its profit forecast for the year to NT$275.1 million.

Mitac Technology Corp (神基科技) fell NT$1, or 3.3 percent, to NT$29.50. The notebook-computer maker cut its pretax profit forecast by 16 percent to NT$765 million.

ProMos Technologies Inc (茂德科技) fell NT$0.65, or 6.6 percent, to NT$9.20. Infineon Technologies AG, which owns 30 percent of the chipmaker and uses 43 percent of its production capacity, said ProMos can't sell semiconductors to anyone else from Jan. 1 without infringing Infineon's patents.