Shares close down 2.88%
Taiwanese shares closed down 2.88 percent yesterday, tracking a fall on Wall Street and other regional bourses, dealers said.
The weighted index fell 131.32 points to 4,425.83 percent on turnover of NT$75.53 billion (US$2.15 billion).
The market opened down 0.63 percent on the Wall Street weakness and growing pessimism pushed the index lower as investors saw how other regional markets were falling, dealers said.
Financial stocks led the downside on fears of further deterioration of the global financial sector after a deal for the US government to boost its stake in troubled banking giant Citigroup, they said.
“It seems that there is no end for the global financial woes. The extended losses in late trade demonstrated such fears,” Taiwan International Securities (金鼎證券) analyst Eric Lee said.
“Judging from today’s trading volume, I suspect the selling largely came from foreign institutional investors,” Lee said, adding that as long as Wall Street remains volatile, such selling will continue.
Lee said the losses yesterday made the bourse technically weaker.
“Further downside is likely over the next few sessions. Fortunately, however, adequate liquidity will lend some support to the market,” Lee said.
Bad loan ratio may double
The nation’s average ratio of non-performing loans (NPLs) may double to more than 3 percent this year, up from 1.54 percent in December, media reported yesterday, citing an estimate by Taiwan Ratings Corp (中華信評).
Figures from the Ministry of Economic Affairs indicated that the government had extended more than NT$110 billion in bailout loans to businesses, while some domestic banks had agreed to give a total of NT$85 billion in loan rollover to businesses, the report said.
If defaulted, the nation’s bad loans may climb from NT$285.2 billion to almost NT$500 billion, it said.
The cost for banks to write off bad loans would also exceed 100 basis points or even 200 basis points, compared with the average of between 50 basis points and 100 basis points in the past five years, the report said, citing Taiwan Ratings analyst Susan Chu (朱素徵).
LNG imports total US$118.4m
Taiwan imported 800,200 kiloliters of liquefied natural gas (LNG) in January at a cost of US$118.4 million, the Bureau of Energy said in an e-mailed statement yesterday.
CPC Corp, Taiwan (台灣中油), the state-owned oil refiner, is the island’s only importer of LNG.
Government sells bonds
The government sold NT$40 billion (US$1.1 billion) in 10-year bonds yesterday at a yield of 1.45 percent, exceeding the rate of return at the last auction of comparable debt.
The yield at the previous sale on Dec. 23 was 1.404 percent. Yesterday’s auction drew bids equal to 1.88 times the debt on offer, compared with 1.97 times at the last auction, a central bank statement said.
AU Optronics invests in US firm
AU Optronics Corp (友達光電), the world’s third-largest maker of liquid-crystal-display (LCD) panels, yesterday said it had invested US$30 million in SiPix Imaging Inc, a US maker of electronic readers, via venture capital arms.
The company’s filing to the Taiwan Stock Exchange said it would obtain a 30 percent stake in SiPix by purchasing common shares.
The Hsinchu-based company said it would ship its first displays used in electronic readers to customers by the end of this year.
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