Wed, Sep 01, 2004 - Page 11 News List

China Development, CMC Magnetics pull shares downward

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Stocks declined for a third day yesterday, as China Develop-ment Financial Holding Corp (中華開發金控) plunged by its daily limit.

The company said it expects to make a loss for the full year.

"China Development dropped the bomb by revising its profit forecast into a big loss," said Jean Yeh (葉琴玲), who manages the US$79 million Balance Fund at Ta Chong Investment Trust Corp (大眾投信) in Taipei.

The TAIEX shed 23.40, or 0.4 percent, to 5765.54. The index climbed 7.1 percent in August, the first monthly gain since February.

Index futures for September shed 0.4 percent to 5763. About 11 stocks declined for every 10 that gained.

China Development Financial dropped 6.8 percent to NT$15.10. The company lost NT$6.3 billion (US$185 million) in the first half after auditing and expects a NT$4.8 billion loss for the full year, it said in a statement.

The company said it had set aside NT$10.9 billion to cover possible losses on invest-ments.

CMC Magnetics Corp (中環), Taiwan's largest maker of recordable compact discs, plunged 6.7 percent to NT$16.80. The company had a second-quarter loss of NT$363 million.

"The compact-disc industry faces the same problem shared by many technology companies: over supply, falling prices, and an inventory that will take time to digest," said George Hou (侯明甫), president of JF Asset Management Co in Taipei.

Second-quarter results were derived by subtracting the first-quarter net income from the first-half results.

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