Sat, Jul 25, 2009 - Page 11 News List

[BUSINESS BRIEFS]

STAFF WRITER, WITH AGENCIES

Profit-taking reverses gains

Taiwanese shares closed down 0.11 percent yesterday as profit-taking reversed early gains on Wall Street’s rally overnight, dealers said.

The TAIEX index fell 7.6 points to 6,973.28 on turnover of NT$149.4 billion (US$4.55 billion).

Losers led gainers 1,265 to 1,054, with 182 stocks unchanged.

The market opened up 0.94 percent after Wall Street rose above the 9,000 point mark for the first time since early January, but investors immediately pocketed profit to take advantage of recent gains, dealers said.

“Investors tend to buy on hopes and sell on news. It was no surprise to witness the market stage the pullback,” Capital Securities (群益證券) analyst Chen Yu-yu (陳育娛) said.

Fuel suppliers raise prices

State-run CPC Corp, Taiwan (CPC, 台灣中油) and its privately run rival Formosa Petrochemical Corp (台塑石化) announced yesterday that they would raise domestic gasoline prices by NT$0.6 a liter, effective today.

Prices for domestic diesel and alcohol-gasoline blends will also be hiked by NT$0.7 per liter to reflect rising fuel costs, the two companies said.

Capital inflows boost M1B, M2

The nation’s monetary aggregates increased last month, with M1B and M2 jumping 17.3 percent and 8.15 percent respectively, the central bank said yesterday.

The monetary regulator attributed the increase in both gauges chiefly to capital inflows over which the agency said it had relatively limited control.

Dawn Chen (陳一端), deputy chief of the central bank’s economic research department, said the pickup in M1B, which refers to currency held by the public and demand deposits, marked the fastest pace since Sept 2004.

The sharp rise in M1B also helped push up the M2 measure, which includes M1B and time deposits, Chen said.

FBHK rating to remain: S&P

Fubon Bank (Hong Kong) Ltd’s (FBHK, 富邦香港) offer on Wednesday to repurchase the so-called Lehman Brothers minibonds from investors is not expected to affect its rating at Standard & Poor’s Ratings Services, the international ratings agency said in a statement yesterday.

Under an agreement reached with Hong Kong authorities, FBHK will pay out an estimated HK$321 million (US$41 million) for the minibonds. The lender plans to pay at least 60 percent or 70 percent of the respective nominal principal value, depending on the age of customers, according to the company’s statement issued on Wednesday.

S&P said the bank needed to set aside a significant amount of provisioning for the proposed repurchase, which could undermine the bank’s standalone credit profile.

“Nevertheless, we regard FBHK as a strategically important subsidiary of Taiwan-based Fubon Financial Holding Co (富邦金控) and expect parental support to continue to underpin the rating,” S&P said in the statement.

NT dollar falls in last minute

The New Taiwan dollar fell in the final minute of trading in Taipei, erasing gains earlier this week, on speculation the central bank intervened to curb appreciation that may hurt exporters.

The NT dollar fell NT$0.153 to close at NT$32.955 against the US dollar as of 4pm, unchanged from the end of last week, Taipei Forex Inc said. It traded at NT$32.790 a minute earlier and reached NT$32.73 on Tuesday. Turnover was US$683 million.

“There was central bank buying towards the end, at NT$32.78 all the way to the NT$32.955 closing,” said Daniel Soh, an economist at Forecast Singapore Pte Ltd, citing conversations with traders.

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