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TAIEX ends lower as Intel-Micron JV depresses IC stocks

Shares fell yesterday, dragged down by memory-chip stocks after Intel Corp disclosed it had formed a joint venture with Micron Technology Inc, which could intensify competition for the nation's chipmakers.

The TAIEX lost 44.23 points, or 0.7 percent, to 6,059.19, on turnover of NT$66.51 billion (US$1.98 billion). Decliners led gainers 694 to 298, with 199 stocks unchanged.

Intel and Micron said on Monday they had formed a joint venture -- IM Flash Technologies LLC -- to produce NAND flash chips and that they had locked in Apple Computer as a major customer.

"The deal between Intel and Micron spreads concerns among Asia's chipmakers that competition will intensify in what is already a very competitive market," said Stanley Chou, a manager at Barits Investment Service (倍利投信).

Taiwanese memory-chip stocks didn't fall as much as their South Korean counterparts, traders said, because none of the nation's memory-chip makers supply NAND chips to Apple, limiting the potential impact of the new venture.

Nanya Technology Corp (南亞科技), the country's largest memory-chip maker by revenue, fell 1.5 percent to NT$17.05, while its closest rival, Powerchip Semiconductor Corp (力晶半導體), slid 1.1 percent to NT$18.1 on the over-the-counter GreTai Securities Market .

The electronics sector fell 1.1 percent yesterday.

Derek Lam, a senior trader at Daiwa SMBC Cathay Securities (大和國泰證券), said the index will likely be stuck in a band between 5,950 and 6,170 in the run-up to local elections on Dec. 3.
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