Taiwanese share prices closed 0.93 percent lower yesterday after Beijing tightened liquidity over the weekend, sparking concerns that China could be ready to take more measures to cool down its runaway economy, dealers said.
They said sentiment was also undermined by a local report that Taiwan believes it will be difficult to encourage more Chinese tourists given Beijing's sensitivities over the political impact of such a move on cross-strait relations.
The weighted index dropped 74.00 points to 7,875.42, off a high of 7,956.03 and a low of 7,843.05, on turnover of NT$83.18 billion (US$2.50 billion).
Fuhwa Securities Corp (復華證券) assistant vice president Samson Chueh (闕山雄) said the tourism sector was badly hit by the Chinese-language China Times report on prospects for attracting more Chinese visitors.
The broader market was also pressured by fund redemptions as investors sought to pocket profits made earlier this year.
"The Chinese tourist [report] put additional pressure on the local bourse, which had already been pressured by fund managers and by concerns over some corporate results," Chueh said.
Thin volumes also pointed to continued caution ahead of the tax season, he added.
"Individuals are required to file tax reports next month [May]. Some are selling their shareholdings to prepare for tax payments," Chueh added.
Acer Inc lost NT$1.40 to drop to NT$63.60 and Hon Hai Precision Industry Co (鴻海精密) gained NT$3.00 to NT$221.50
In the tourism sector, Ambassador Hotel (國賓飯店) fell NT$2.65 to NT$36.00 and Hotel Holiday Garden (華園飯店) was limit-down NT$2.70 at NT$36.10.
RSS