TAIEX weaker on US demand fears

Taiwan stocks fell after the government said the unemployment rate climbed to a record for a seventh month in July.

Asustek Computer Inc (華碩電腦) paced declines on concern that demand for computer-related products remains stagnant. Yesterday, the government said overseas orders for Taiwan-made goods fell 17 percent in July from a year ago.

The TAIEX fell 27.76, or 0.6 percent, to 4459.76.

Within the index, 216 stocks dropped and 211 rose. The total value of trade today was NT$42.29 billion (US$1.25 billion), 41 percent less than this year's daily average of NT$73.24 billion.

Makers of computer products fell on concern US companies will cut orders from Taiwanese manufacturers. Dell Computer Corp is among the companies firing workers as customers reduce orders for computers. Acer Inc (宏電), another computer maker, fell NT$0.60, or 3.5 percent, to NT$16.80. Asustek Computer, a computer motherboard and notebook maker, fell NT$3, or 2.2 percent, to NT$136. Gigabyte Technology Ltd (技嘉科技), a computer mother board maker, fell NT$1.50, or 1.8 percent, to NT$80. Quanta Computer Inc (廣達電腦), the nation's biggest notebook computer maker, shed NT$1.50, or 1.9 percent, to NT$76.

Shares of Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) were unchanged at NT$62 after earlier falling as much as 3.2 percent.

They tracked the plunge in TSMC's American depositary receipts, partly on expectations US investors will buy more lower-cost derivatives that track local share prices. Local shares of Taiwan's biggest chipmaker are less expensive than American depositary receipts because only foreign investors licensed by the Taiwan government are allowed to buy them. TSMC's depositary receipts plunged 11 percent yesterday, narrowing its premium to the local stock to 38 percent from 56 percent on Monday.