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TAIEX falls slightly, but still manages to stay above 8,000

Taiwan share prices closed 0.85 percent lower yesterday on margin calls, although late bargain-hunting pushed the index above 8,000 points again on a day of heavy trade, dealers said.

The TAIEX closed 69.87 points down at 8,118.08 on turnover of NT$151.72 billion (US$4.70 billion).

For the week to yesterday, the weighted index closed down 604.08 points or 6.93 percent at 8,118.08 after a 1.58 percent rise a week earlier.

Average daily turnover was at NT$113.63 billion, compared with NT$108.92 billion a week ago.

While some local stocks managed to rebound during early trade, lingering worries over US economic health and the worsening domestic political atmosphere continued to plague the market, dealers said.

Profit margins are set to suffer as new Chinese regulations will increase the labor costs and tax burdens of Taiwanese firms in the mainland, they said.

Bargain hunters surfaced during the last 30 minutes of the session after the index tumbled below 8,000 points.

Frank Lin (林玉田), senior vice president with Fubon Securities (富邦證券), said institutional investors and individuals were eager to reduce holdings in the wake of worrisome factors both at home and overseas.

"Foreign investors were concerned about global economic prospects and the island's political uncertainties," he said.

Fund managers also faced redemption pressure following the retreat. Individual investors also suffered, Lin said.

"All these factors led to panic selling in late trade before bargain-hunting managed to curb the downside," he said.
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