Shares unchanged as caution offsets Wall Street gains

Shares closed little changed yesterday with investor caution offsetting early gains made on Wall Street's extended rally, dealers said.

They said investors adopted a cautious approach on the last trading day of the quarter given a lack of major fresh leads and continuing concerns over an opposition campaign to force President Chen Shui-bian (陳水扁) to step down over corruption allegations.

The TAIEX slipped 2.07 points at 6,883.05, on turnover of NT$69.83 billion (US$2.11 billion). Gainers, however, led decliners 618 to 461, with 169 stocks unchanged.

For the week to yesterday, the weighted index was flat, slipping just 0.04 percent after a 3.06 percent gain the previous week.

Average daily turnover stood at NT$75.13 billion, down from NT$84.34 billion.

Despite cautious sentiment, some select stocks, including BenQ Corp (明基) and Chunghwa Telecom Co (中華電信) outperformed the broad market on their respective leads, while financial stocks benefited from the central bank's decision to raise key interest rates by 12.50 basis points.

BenQ closed limit-up NT$1.25 at NT$19.45, after it decided to stop injecting capital into its German cell phone unit, which is considering filing for insolvency protection.

Chunghwa Telecom gained NT$1.20 to NT$54.90, after the government successfully sold shares in the telecom firm on the local and foreign markets.

Taiwan share prices should find support from the bellwether electronic sector next week on hopes the major companies will report solid sales figures for this month in the traditionally stronger run-up to the year-end holiday season, dealers said.