UMC slips to nine-year low
United Microelectronics Corp (UMC, 聯電), the world's second-largest maker of chips for other companies, slid to a nine-year low yesterday after UBS AG downgraded the shares to "neutral," citing a seasonal slowdown for the company.
UMC shares fell 4.9 percent to NT$21.30 at the close of trade, their lowest since Oct. 6, 1998.
"We expect slowing momentum, given the high base in Q3 ... and seasonal slowdown," Taipei-based analysts William Dong, Robert Lea and Samson Hung wrote in a report dated Thursday.
UMC's plan to issue stock options to employees from next year also has the potential to dilute earnings, the analysts wrote.
The potential dilution of the 500 million stock options is about 3.8 percent in the next six years, UMC said in an e-mail.
UBS cut its rating on UMC from "buy" and lowered its 12-month price target to NT$24 from NT$28.60.
Next step for Nicaraguan FTA
Taiwan and Nicaragua exchanged instruments of rectification on Thursday for a bilateral free trade agreement (FTA) that was signed last year to pave the way for its implementation this Jan. 1.
Minister of Economic Affairs Steve Chen (陳瑞隆) and visiting Nicaraguan Foreign Minister Samuel Santos Lopez exchanged the documents in a ceremony at the Ministry of Economic Affairs.
After the FTA takes effect next year, Nicaragua will allow tariff-free entry of 3,374 Taiwanese products, which is about 51.1 percent of Taiwanese exports to Nicaragua, while Taiwan will lift tariffs on the entry of 5,797 Nicaraguan products, or about 65.6 percent of Nicaraguan exports, including beef and coffee.
China's reserves keep growing
China's foreign exchange reserves, already the world's largest, surpassed US$1.43 trillion at the end of last month, the central bank said yesterday.
The figure was up 45.1 percent from a year earlier, the central bank said in a statement posted on its Web site.
Special zone status for Hainan
China has approved the establishment of a special export zone for the island province of Hainan in a bid to boost trade, especially with Southeast Asia, state media said yesterday.
The Yangpu Bonded Port Area will enjoy tax breaks and other preferential policies similar to zones in Shanghai, Tianjin and Dalian, the Shanghai Securities News said.
The Yangpu Port, approved by the State Council, will be built in three phases and eventually cover an area of 9.2km2, with an annual traffic of 70 million tonnes, the report said.
Cathay Life to add Beijing outlet
Cathay Life Insurance Co (國泰人壽), the nation's largest life insurer, said yesterday its Chinese venture based in Shanghai has been approved to open a new branch in Beijing.
Cathay Life said the joint venture with China Eastern Air Holding Co (中國東方航空) obtained approval from the China Insurance Regulatory Commission yesterday for the establishment of the Beijing branch, a filing to the Taiwan Stock Exchange showed.
Meanwhile, Cathay Life and affiliated Cathay Century Insurance Co (國泰世紀產險) announced yesterday that they had also received China's go-ahead to set up a property insurance company there.
The new property insurance company, which will be launched with 200 million yuan (US$26.6 million) from Cathay Life and Cathay Century each, will be the first Taiwanese property insurer operating in China.
Cathay Life broke into China's insurance market in 2005.
WEAKER ACTIVITY: The sharpest deterioration was seen in the electronics and optical components sector, with the production index falling 13.2 points to 44.5 Taiwan’s manufacturing sector last month contracted for a second consecutive month, with the purchasing managers’ index (PMI) slipping to 48, reflecting ongoing caution over trade uncertainties, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday. The decline reflects growing caution among companies amid uncertainty surrounding US tariffs, semiconductor duties and automotive import levies, and it is also likely linked to fading front-loading activity, CIER president Lien Hsien-ming (連賢明) said. “Some clients have started shifting orders to Southeast Asian countries where tariff regimes are already clear,” Lien told a news conference. Firms across the supply chain are also lowering stock levels to mitigate
Six Taiwanese companies, including contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), made the 2025 Fortune Global 500 list of the world’s largest firms by revenue. In a report published by New York-based Fortune magazine on Tuesday, Hon Hai Precision Industry Co (鴻海精密), also known as Foxconn Technology Group (富士康科技集團), ranked highest among Taiwanese firms, placing 28th with revenue of US$213.69 billion. Up 60 spots from last year, TSMC rose to No. 126 with US$90.16 billion in revenue, followed by Quanta Computer Inc (廣達) at 348th, Pegatron Corp (和碩) at 461st, CPC Corp, Taiwan (台灣中油) at 494th and Wistron Corp (緯創) at
NEW PRODUCTS: MediaTek plans to roll out new products this quarter, including a flagship mobile phone chip and a GB10 chip that it is codeveloping with Nvidia Corp MediaTek Inc (聯發科) yesterday projected that revenue this quarter would dip by 7 to 13 percent to between NT$130.1 billion and NT$140 billion (US$4.38 billion and US$4.71 billion), compared with NT$150.37 billion last quarter, which it attributed to subdued front-loading demand and unfavorable foreign exchange rates. The Hsinchu-based chip designer said that the forecast factored in the negative effects of an estimated 6 percent appreciation of the New Taiwan dollar against the greenback. “As some demand has been pulled into the first half of the year and resulted in a different quarterly pattern, we expect the third quarter revenue to decline sequentially,”
ASE Technology Holding Co (ASE, 日月光投控), the world’s biggest chip assembly and testing service provider, yesterday said it would boost equipment capital expenditure by up to 16 percent for this year to cope with strong customer demand for artificial intelligence (AI) applications. Aside from AI, a growing demand for semiconductors used in the automotive and industrial sectors is to drive ASE’s capacity next year, the Kaohsiung-based company said. “We do see the disparity between AI and other general sectors, and that pretty much aligns the scenario in the first half of this year,” ASE chief operating officer Tien Wu (吳田玉) told an
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