Fri, Oct 03, 2008 - Page 11 News List

TAIEX drops in spite of bailout clearing Senate

JITTERS ABOUND Elsewhere in Asia, investors were cautious, with most indexes falling as traders decided to await another vote in the House of Representatives

AFP , TAIPEI AND HONG KONG

Taiwanese share prices closed 1.05 percent lower yesterday amid growing concerns about the global financial crisis, despite the US Senate’s approval of a bailout package for the finance industry, dealers said.

The weighted index fell 60.29 points to 5,703.72 on turnover of NT$66.46 billion (US$2.08 billion).

Losers outnumbered gainers 912 to 672, with 401 shares unchanged.

The key electronics sector, an engine of Taiwan’s export industry, fell 1.84 percent amid concerns it might take a hard hit while consumers were reluctant to spend on electronic products in the difficult times, analysts said.

“Like its peers in the region, the local market also opened high but closed low. Investors cashed out in the early trade,” Chen Yu-yu (陳育榆) of Capital Securities (群益證券) said.

“Investors feared the US bailout package could not help its financial crisis ... the outlook for the global economy is dim over the long term,” he said.

Elsewhere in Asia, investors remained cautious with most major indexes falling, as traders decided to await the outcome of another vote in the House of Representatives expected on Friday.

The House’s rejection of the original US$700 billion plan on Monday sent world stock markets into a tailspin, a week after they had plummeted following the collapse of Lehman Brothers.

Tokyo shed 1.88 percent to end at a three-year low, while Sydney eased by 0.7 percent and Seoul slipped 1.39 percent.

But Hong Kong recorded a rise of more than 1 percent, while Singapore was also better off, lifting 0.2 percent.

Many markets were closed because of public holidays.

“People are just hanging on the US decision,” said James Foulsham, CMC Markets head of trading in Australia.

“We saw some news on that this morning, but until we get a firmer view one way or the other, I think people are going to stay out of the market because it’s too risky,” he said.

However, in Japan the Nikkei ended at its lowest level since May 2005, with traders also jittery about the prospects for the rest of the economy.

Exporters were hammered, dragging the index, as the US dollar slipped, making it more expensive to buy Japanese goods.

But Hong Kong was up due to a strong rally in Ping An Insurance (平安保險), which ended a plan to buy half the asset management arm of troubled European bank Fortis, dealers said.

In other markets Wellington rose 1.4 percent and Manila gained 1.68 percent.

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