Profit-taking hits trading following rallies at weekend

Share prices closed 0.18 percent lower yesterday as early gains gave way to profit-taking, with investors reluctant to push the upside further amid a lack of fresh leads, dealers said.

They said investors were at least relieved that weekend rallies by pro- and anti-government forces had passed off peacefully but concerns at President Chen Shui-bian's (陳水扁) harder line on relations with China remain in place.

That was probably enough to keep the market in check, ensuring it missed out on the strong regional gains amid some speculation that foreign investors are betting on a correction back to 6,000 points.

The weighted index lost 12.05 points at 6,516.52, off a high of 6,569.53 and a low of 6,510.58, on turnover of NT$98.21 billion (US$3.03 billion).

"Our market should have staged some sort of upswing given the mostly bullish showing in the region but it didn't," SinoPac Securities (建華證券) assistant vice president Alvin Teng (鄧可欣)said.

"There was really no convincing lead in sight to justify a big decline but investors simply would not bring themselves to buy shares aggressively," he said.

Although individual investors seemed to have started buying again, foreign institutions apparently remained sellers, preventing the market from ending in positive territory, he said.

"We have heard some foreign investors talking about a possible correction to 6,000 points for local shares to become attractive again," he said.

"Maybe that is part of the reason for the market to behave the way it has lately -- going nowhere," Teng said.