TAIEX down on profit-taking
Share prices closed 1.35 percent lower yesterday in active trade as profit-taking reversed early gains driven by the overnight upturn on Wall Street after oil prices came off record highs, dealers said.
They said the market had been supported ahead of the expiry of futures contracts yesterday and clearly found resistance approaching the 6,400 points level to be very strong.
The TAIEX closed down 85.19 points at 6,231.65, on turnover of NT$90.88 billion (US$2.9 billion).
"Most people were so smart that they were eager to lock in their profits ahead of others," said Alvin Teng (鄧可欣), an assistant vice president at SinoPac Securities Corp (建華證券).
"Expectations of a market upswing on futures settlement sufficed to negate that very prospect, as few would want to be left on board a train drawing to a final stop, at least for the near term," he said.
The market outlook for the coming weeks hinges on crude oil price movements, which will in turn dictate how Wall Street fares down the road, he said.
"It makes you wonder if foreign investors will find reason to curtail their holdings in the Taipei bourse that has shown impressive resilience lately," he said.
United Microelectronics Corp (聯電) was down NT$0.40 at NT$23.
Bond index introduced
Citigroup Inc, the world's biggest financial-services company, yesterday introduced an index tracking Taiwanese government bonds, a move that may help attract international investors.
The Taiwan Government Bond Index tracks 33 issues with a total market value of NT$1.9 trillion (US$61 billion), Susan Lin (林瑩慧), a Hong Kong-based managing director for indexes at Citigroup, said in a seminar in Taipei.
Creation of the index paves the way for Taiwan's possible inclusion in Citigroup's World Government Bond Index, which fund managers use as a yardstick for about US$1 trillion of funds, Lin said.
"If Taiwan becomes part of the index, about 0.59 percent of the US$1 trillion will flow into the Taiwan bond market," Lin said.
She didn't give a timeframe for the nation to become part of the global index, which covers 22 markets, including Japan and Singapore.
NPL ratio down 0.03%
The non-performing loan (NPL) ratio, including loans under surveillance, slowed to 3.64 percent as of the end of last month, down 0.03 percent from the end of April, Bureau of Monetary Affairs said on Tuesday.
The bad loans at the nation's 47 banks totaled NT$577.8 billion (US$18.35 billion) last month, up from NT$577.5 billion in April, the bureau said.
NT dollar dips
The New Taiwan dollar continued trading lower against its US counterpart, declining NT$0.176 to close at NT$31.610 on the Taipei foreign exchange market.
Turnover was US$1.25 billion.
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