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Fri, Sep 14, 2001 - Page 18 News List

TAIEX falls below 4,000 for the first time since 1993

WANING CONFIDENCE With the tech sector's outlook bleak and terrorist attacks on the nation's biggest market, Taiwan's investors took index stocks 5.4 percent lower


Taiwan's key stock index closed below 4,000 for the first time in almost eight years on concern the terrorist attacks in the US will depress economic growth and demand from the world's biggest economy. Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) led the slump.

The TAIEX slid 224.44, or 5.4 percent, to 3,952.49, its lowest level since Oct. 21, 1993. It was also the biggest percentage drop since Nov. 20 of last year. Within the index, 476 stocks fell and only 16 rose. The trading volume was NT$17.70 billion (US$513 million), the lowest since Dec. 21 of last year.

"It's highly likely that the Taiwanese market will weaken substantially perhaps by 10 percent to 15 percent as it's heavily dependant on US export demand to support a flagging domestic economy,'' said Roland Wee, who helps manage US$1.2 billion in Asian equities at ING Investment Management Asia.

Taiwan said Wednesday it will keep its current 7 percent limit on share movements unchanged and Finance Minister Yen Ching-chang (顏慶章) said he doesn't think the NT$500 billion stock market stabilization fund needs to be activated.

Chipmakers slumped on concern their sales will be hurt because of delayed airfreight shipments after the terrorist attacks in New York and Washington.

TSMC, the largest contract chipmaker, fell NT$4, or 6.4 percent, to NT$59. United Microelectronics Corp (UMC, 聯電), the second-largest contract chipmaker, fell NT$2.60, or 6.8 percent, to NT$35.90.

Financial stocks fell on concern trading and settlement by financial institutions may be affected after the terrorist attacks closed New York's financial district for a second day and forced many banks to shift their main trading desks to Europe or Asia.

Cathay Life Insurance Ltd (國泰人壽) fell NT$1.20, or 3.1 percent, to NT$38.10. China Development Industrial Bank (中華開發工銀), the biggest lender by market value, fell NT$1.50, or 6.9 percent, to NT$20.40. Hua Nan Commercial Bank (華南銀行), the second-biggest listed lender by assets, fell NT$0.40, or 2.4 percent, to NT$16.60.

Computer makers slid on concern disruptions to US-bound flights may delay shipment of products as companies struggle with slowing demand. Worldwide personal computer shipments will decline more than forecast as sales are hurt after the worst terrorist attack in US history, IDC analyst Roger Kay said.

Acer Inc (宏電), a computer maker, fell NT$0.85, or 6.8 percent, to NT$11.70. Asustek Computer Inc (華碩電腦), Taiwan's biggest motherboard maker, fell NT$9, or 6.9 percent, to NT$121.

Compal Electronics Inc (仁寶電腦), a notebook computer maker, fell NT$2.20, or 6.8 percent, to NT$30.20. Hon Hai Precision Industry Ltd (鴻海精密), which makes everything in a computer except chips, fell NT$3.50, or 3.1 percent, to NT$109.

Quanta Computer Inc (廣達電腦), Taiwan's biggest notebook computer maker, fell NT$5, or 6.5 percent, to NT$72.

Yageo Corp (國巨), the largest maker of parts that control the flow of electricity in computer and mobile telephone circuits, fell NT$1.40, or 6.6 percent, to NT$19.90.

Memory chipmakers dropped as the spot price for their main product remains below the cost of production. The spot price for the 64Mb DRAM chip is at US$0.74, according to DRAM Exchange, a market place for memory chips. An inability to ship products because of canceled flights may also weigh on stocks over the coming days.

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