TAIEX falls again as AU Optronics and Chi Mei drop

The TAIEX dropped for the eighth day in nine yesterday, shedding 21.17, or 0.4 percent, to close at 5387.96. The index has slumped 6.8 percent since July 12.

Stocks for flat-panel display makers such as AU Optronics Corp (友達光電) and Chi Mei Optoelectronics Corp (奇美電子) fell on concerns demand in the second half of the year will slow.

Acer Inc, the nation's only computer maker with an international brand, gained. Acer estimates desktop computer shipments will surge 50 percent quarter-on-quarter in the second six months of the year, a Chinese-language newspaper reported.

Futures for July delivery lost 0.8 percent to 5,291. Three stocks gained for every two that fell.

AU Optronics, the world's third-largest maker of flat-panel displays for computers and TVs, fell NT$1.10 to NT$40.30. After the market closed, AU Optronics said second-quarter profits rose almost fivefold to a new record, helped by lower production costs and higher demand.

Chi Mei Optoelectronics tumbled NT$2.10, or 4.6 percent, to NT$44. Prices of flat-panel displays began sliding in the second quarter after demand for flat TVs lagged behind supplier expectations, researcher ISuppli Corp said.

"The technology industry is badgered by overcapacity and lackluster demand," said Mike Shiao (蕭光一), who manages the equivalent of NT$60 million in assets at Invesco Taiwan (景順投信) in Taipei.

Acer gained NT$0.30, or 0.7 percent, to NT$46.30. Acer will also introduce flat-panel TVs made by Quanta Computer Inc (廣達電腦) in September, the newspaper said, citing Acer president Wang Chen-tang (王振堂).