The TAIEX shed 77.92 points, or 1.09 percent, to close at 7,103.62 yesterday as unease over the credit ratings downgrade of nine European nations outweighed expectations of post-election rallies after President Ma Ying-jeou (馬英九) secured his second term on Saturday, analysts said.
The cautious sentiment is set to increase today and tomorrow, when the local bourse is due to close for the Lunar New Year holidays, driving investors to trim holdings to avoid a liquidity trap, they said.
“The end of the presidential election helped clear [domestic] political uncertainty, allowing the market to refocus on financial issues,” Jordan Chen (陳朝燈), chief investment officer at Schroder Investment Management Taiwan, told a media briefing.
Photo: Fang Pin-chao, Taipei Times
The TAIEX’s tumble was in line with poor showings across Asian bourses as worries over the European debt crisis intensified after Standard & Poor’s (S&P) on Friday cut sovereign credit ratings for nine European states, Chen said.
In particular, S&P deprived France and Austria of their “AAA” standing, lowered credit ratings for Italy, Spain and Portugal by two notches and put 14 states in the bloc on its negative credit watch.
Concerns over European debt problems will extend into this year after seeing the TAIEX plunge by 21 percent last year, Chen said.
Clearly, the financial sector yesterday was under heavy pressure because of escalating European debt problems, with Mega Financial Holding Co (兆豐金控) falling 4.4 percent to close at NT$19.55 and Chinatrust Financial Holding Co (中信金控) shedding 4.2 percent to end at NT$18.25.
Turnover was NT$74.6 billion (US$2.54 billion) on the main bourse, down from NT$97.84 billion on Friday, Taiwan Stock Exchange data indicated.
The benchmark index is likely to fluctuate within a tight range in the next two sessions, with more investors expected to stay on the sidelines until the market reopens on Jan. 30, Chen said.
Foreign institutional players slashed a net NT$5.68 billion in local shares, while mutual funds and proprietary dealers cut net holdings by NT$2.49 billion and NT$1.53 billion respectively, according to stock exchange statistics. Technology firms bore the brunt of the fall, with shares in Taiwan Semiconductor Manufacturing Co (台積電) falling 2.84 percent to close at NT$75.3 and rival United Microelectronics Corp (聯電) ending 4.2 percent lower at NT$13.45, after investors took cues from a tumble of their counterparts on Wall Street at the end of last week, dealers said.
Hon Hai Precision Industry Co (鴻海精密) was down 2 percent to NT$83.5, while Advanced Semiconductor Engineering Inc (日月光半導體) shed 2.85 percent to NT$27.25, stock exchange data showed.
Shares in those companies rose significantly after a government stabilization fund stepped in on Dec. 20 to prop up the local bourse, they said.
Schroder Investment takes a neutral view about the TAIEX this year, saying advanced economies will exercise fiscal discipline, suppressing growth for export--oriented economies, including China and Taiwan, Chen said.
Allianz Global Investors Taiwan Ltd (德盛安聯投信) lent support to a conservative approach ahead of the holidays.
Investors can wait until after major US technology firms unveil their fourth-quarter financial results later this month, Allianz fund manager Eric Li (李俊毅) said yesterday.
Lackluster performance will suggest weak restocking demand, boding ill for contract electronic makers in Taiwan, Lee said.
See ASIAN on page 10
Taiwan Transport and Storage Corp (TTS, 台灣通運倉儲) yesterday unveiled its first electric tractor unit — manufactured by Volvo Trucks — in a ceremony in Taipei, and said the unit would soon be used to transport cement produced by Taiwan Cement Corp (TCC, 台灣水泥). Both TTS and TCC belong to TCC International Holdings Ltd (台泥國際集團). With the electric tractor unit, the Taipei-based cement firm would become the first in Taiwan to use electric vehicles to transport construction materials. TTS chairman Koo Kung-yi (辜公怡), Volvo Trucks vice president of sales and marketing Johan Selven, TCC president Roman Cheng (程耀輝) and Taikoo Motors Group
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
RECORD-BREAKING: TSMC’s net profit last quarter beat market expectations by expanding 8.9% and it was the best first-quarter profit in the chipmaker’s history Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), which counts Nvidia Corp as a key customer, yesterday said that artificial intelligence (AI) server chip revenue is set to more than double this year from last year amid rising demand. The chipmaker expects the growth momentum to continue in the next five years with an annual compound growth rate of 50 percent, TSMC chief executive officer C.C. Wei (魏哲家) told investors yesterday. By 2028, AI chips’ contribution to revenue would climb to about 20 percent from a percentage in the low teens, Wei said. “Almost all the AI innovators are working with TSMC to address the
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”