Shares follow Wall Street's fall on back of Bernanke remark

AFP , TAIPEI

Fri, Jul 20, 2007 - Page 11

Shares closed 0.13 percent lower yesterday, tracking overnight falls on Wall Street after US Federal Reserve Chairman Ben Bernanke struck a cautious note on the US economy, dealers said.

They said Bernanke had instilled that note after he said the US housing sector might get worse before it gets better and that it remains a risk to consumer spending and economic growth.

Downside on the local bourse was limited, however, by the still strong expectations that there will be another rally ahead of next year's elections.

The TAIEX closed down 12.04 points at 9,473.31, on turnover of NT$232.29 billion (US$7.1 billion).

Decliners led risers 750 to 702, with 159 stocks unchanged.

"Shares continued to consolidate their gains ... [which previously] pushed the benchmark index to above 9,500 points," said Oliver Fang, a Yuanta Core Pacific Securities (元大京華證券) assistant vice president.

"We have not seen a decisive pullback either, for most people would not be put off by a healthy hiatus ahead of a resumed rally towards 10,000 points," he said.

Powerchip Semiconductor Corp (力晶半導體) was up 0.48 percent at NT$21.20 after booking a capital gain of NT$224.10 million from another sale of Macronix International Co (旺宏電子) shares. Last Friday Powerchip said it earned NT$212.3 million by selling 35 million shares in Macronix.

Shares of Macronix were limit-up at NT$17.50, gaining on expectations it will benefit from its close ties with client Nintendo Co. SinoPac Securities Corp (永豐金證券) analyst Sophie Chuang gave an outperform rating on Macronix yesterday, with a target price of NT$26.1.

Additional reporting by staff writer