Profit-taking by investors pushes stock market lower

Shares ended slightly lower yesterday as technology shares fell on profit-taking after the bourse rose to a 15-month high on Wednesday.

Dealers said AU Optronics Corp (友達光電) and MediaTek Inc (聯發科技) were in focus after upbeat second-quarter earnings and comments, while the tourism sector outperformed the broader market, on hopes of more tourist arrivals from China.

The TAIEX closed down 9.56 points, or 0.2 percent, to 6,446.01, on turnover of NT$108.96 billion (US$3.42 billion).

"Despite the modest pullback, sentiment remains quite positive given expectations there may be further upside for the main index," said Stanley Chou, an analyst at Barits Investment Service (倍利投顧).

He said the benchmark index may test 6,500 soon.

Taiwan Semiconductor Manufacturing Co (台積電), the world's largest contract chipmaker, lost 2.2 percent to NT$54.70. Rival United Microelectronics Corp (聯電) fell 0.7 percent to NT$22.15.

ProMOS Technologies Inc (茂德科技) lost 1.99 percent to NT$12.85, despite news that it expects DDR dynamic random access memory chip contract prices this month to increase 5-10 percent from last month.

However, gains in AU Optronics and MediaTek partly offset the decline in chip shares.

AU Optronics closed up 1 percent at NT$53.10, after reporting a second-quarter net profit of NT$470 million on Wednesday. MediaTek rose the 7 percent limit-up to NT$373, as the integrated circuits design house's net profit for the second quarter rose to NT$4.17 billion.