Wed, Jun 26, 2013 - Page 13 News List

TAIEX hit by tax law uncertainty, Asia market losses

Staff writer, with CNA

The TAIEX bottomed out at a 12-month low yesterday amid uncertainty that the Legislative Yuan had yet to pass an amendment to the Income Tax Act (所得稅法) revising the capital gains tax on securities investments and on similar losses seen across Asian stock markets.

The weighted index closed down 94.80 points, or 1.22 percent, at 7,663.23, after fluctuating between 7,792.27 and 7,663.23 on turnover of NT$92.88 billion (US$3.1 billion).

Foreign institutional selling continued to focus on large-cap stocks, in particular the high-priced shares of IC inspection tool supplier Hermes Microvision Inc (漢微科) and LCD panel-maker HannStar Display Corp (瀚宇彩晶), both of which plunged by the maximum daily limit to close at NT$862 and NT$11.7 respectively.

TUMBLE

Similar movements were observed in neighboring markets after Chinese stocks tumbled to their lowest level in more than four years on the back of Beijing’s credit-tightening policies.

Foreign institutional investors said that even if the Legislative Yuan passes the tax revision, the local bourse would still not pick up because the international markets continue to be bearish.

The revision was expected to be passed at a legislative session later in the day.

President Securities Corp (統一證券) analysts said global stock markets would continue to be influenced by the US Federal Reserve’s decision to wind down its quantitative easing measures, prompting investors to be conservative about their purchases in the short-term.

CONVENIENCE STORES

Hon Hai Precision Industry Co (鴻海精密), the world’s largest contract electronics maker, ended down 0.14 percent at NT$70.20, despite news that its large-panel TVs will be sold in an international chain of convenience stores.

Among the highly priced stocks that were the targets of foreign investors, Largan Precision Co (大立光), a major manufacturer of cellphone camera lenses, fell 2.02 percent to close at NT$921, while MediaTek Inc (聯發科) rose 1.62 percent to end at NT$314 following its entry into the lucrative tablet market.

In the flat-panel sector, Innolux Corp (群創光電) fell 2.33 percent to close at NT$14.7 and AU Optronics Corp (友達光電) lost 1.94 percent to end at NT$10.10 on a slowdown in the global display and solar markets.

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