Wed, Jul 30, 2008 - Page 11 News List

Business Briefs

STAFF WRITER, WITH AGENCIES

Shares close lower

Taiwanese shares closed down 3 percent yesterday on profit-taking after sharp falls on Wall Street amid more bad news from the troubled US financial sector, dealers said.

The weighted index lost 219.15 points to 7,014.47 on turnover of NT$86.8 billion (US$2.86 billion).

“The financial sector took a hard hit in the wake of the Wall Street slump as investors feared there might be new troubles in the US financial sector,” said Mars Hsu of Grand Cathay Securities (大華證券).

Citi trims TAIEX forecast

Taiwanese stocks may rally less than forecast as earnings growth slows and liquidity shrinks, Citigroup Inc said.

The TAIEX will probably end the year at 8,250, which is 18 percent higher than yesterday’s close, analysts led by Peter Kurz said in a report yesterday.

Citi pared its earlier forecast of 12,000 based on the expectation that President Ma Ying-jeou (馬英九) of the Chinese Nationalist Party (KMT) would bolster ties with China after his election victory in March.

“We were admittedly overly optimistic about the market impact of the KMT electoral victory,” the analysts wrote in the report. “However, since our prediction one year ago, earnings, monetary growth and multiples have all contracted.”

Profits will probably contract 3.9 percent this year because of lower earnings estimates for memory-chip makers, banks and flat-panel producers, the analysts estimated. They had earlier forecast growth of 14 percent.

Money supply may also shrink 1.1 percent, compared with the brokerage’s earlier estimate of 9.1 percent growth, the report said.

The TAIEX is still expected to rebound in the second half and climb to as high as 9,100 in 12 months as improved ties with China encourage investment and spending, the analysts said.

Via shares climb

Via Technologies Inc (威盛電子), Taiwan’s largest maker of computer processors, climbed the most in almost a week in Taipei after a report said the company will supply chips for a Sony Corp notebook to be released next quarter.

Via added 3.6 percent to NT$18.80 (US$0.62) at 12:22pm in Taipei, compared with a 3.5 percent slide in the benchmark TAIEX index.

Sony’s new low-cost notebook will go on sale in the fourth-quarter and feature a 10-inch display with Via’s C7-M processor, the Chinese-language Commercial Times reported yesterday, without citing sources.

AUO shares fall

AU Optronics Corp (AUO, 友達光電), the nation’s largest maker of liquid-crystal displays, declined the most in 10 days in Taipei after it was downgraded by one brokerage and had its price target cut by another.

AUO fell 4.4 percent to NT$38.80 at the close of trade on the Taiwan Stock Exchange, compared with a 3 percent drop in the benchmark TAIEX. The stock was the second most active on the Taiwan bourse yesterday with 74.1 million shares traded.

Prices of panels used in televisions and computers will fall 15 percent this quarter, HSBC Holdings Plc analyst Wang Wanli (王萬里) wrote in a report on Monday.

Wang cut the brokerage’s full-year profit estimate on Hsinchu-based AUO by 41 percent and downgraded the stock to “neutral” from “overweight.” The price target on the shares was lowered by 42 percent to NT$43.25.

NT dollar weakens

The New Taiwan dollar yesterday weakened by NT$0.058 to close at NT$30.465 against the greenback on turnover of US$1.445 billion.

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