TAIEX at two-year low
Taiwanese shares hit a two-year low yesterday after dropping 1.71 percent on worries over weakening global demand, dealers said.
The weighted index fell 114.89 points at 6,584.93, on turnover of NT$91.70 billion (US$2.88 billion).
It was the lowest close since late August 2006. Losers outnumbered gainers by 1,810 to 221 with 361 stocks unchanged.
Weakness in US and regional economies has cast a long shadow over local market confidence, said Taiwan International Securities (金鼎證券) analyst Arch Shih (施博元).
“I do not expect the local bourse will stabilize soon,” Shih said. “It is hard for the market to find short-term technical support.”
China must act: regulator
China must curb expectations that its currency will keep rising, as forecasts of its continued appreciation are fueling cumbersome fund inflows, the top banking regulator said.
“There is currently an urgent need … to break expectations of the exchange rate’s continued and unilateral appreciation,” Qiushi journal quoted Liu Mingkang (劉明康), chairman of the China Banking Regulatory Commission, as saying.
He did not specify how expectations could be lowered. However, remarks by senior officials such as his could be one way for China to engineer a new mood in the market.
Taipower expects more losses
Taiwan Power Co (Taipower, 台電), the nation’s grid operator and biggest electricity producer, expects a wider loss next year because of rising fuel costs.
The state-run utility may post a loss of NT$149.6 billion, from a projected NT$120 billion this year, after factoring in an increase in power tariffs starting next month, Tu Yueh-yuan (杜悅元), company chief engineer, said yesterday.
Taipower could increase its borrowings to help fund spending on power plants and other equipment next year as fuel expenses erode earnings.
Taipower raised prices by 12.6 percent in July and has government permission to increase tariffs by an additional 12.6 percent next month. The government will decide whether the company can increase prices next year, Tu said.
Taipower plans to sell as much as NT$80 billion of bonds this year, said Tu, declining to comment on the debt sale plan for next year.
China Steel sales up
China Steel Corp (中鋼), the nation’s largest steelmaker, saw sales climb 50.71 percent year-on-year last month to NT$26.52 billion, the company said in a stock exchange filing yesterday.
Last month’s sales, a record monthly high for the Kaohsiung-based company, represented an increase of 2.01 percent from the previous month, the filing said.
For the first eight months of the year, the company saw its revenue total NT$176.84 billion, up 31.15 percent from a year earlier.
Uni-President shares down
Uni-President Enterprises Corp (統一企業), Taiwan’s largest food company, fell by the daily limit in Taipei trading to the lowest in a year after the government said instant noodle prices dropped last month.
Uni-President’s stock plunged 6.9 percent to NT$30.90, the lowest since Aug. 21 last year. Shares have fallen 26 percent this year, compared with the benchmark’s 23 percent decline.
Uni-President had 47.4 percent of Taiwan’s instant-noodle market last year, the company said in a presentation last month.
The stock was downgraded to “buy” from “strong buy” at Nomura Holdings Inc. Lower profit margins prompted the broker to cut its price estimate to NT$39.30 from NT$47.30, Hong Kong-based analyst Dave Chiou wrote in a report yesterday.
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